Ashburn on the Market

One of our second generation R2000 homes is on the market as of yesterday. The listing is available here. We had SRP run a SEEFAR© analysis (see below) on the house to asses the total cost of building ownership of the house compared to others in the neighbourhood. The results were compiled into a report that Red River Group (appraisal company) was able to use to determine the value of the energy efficient upgrades. Using the value method they determined that the upgrades were worth $67,000 on top of the value of the home itself. Assiniboine Credit Union says that they will also recognize the SEEFAR© report when considering a mortgage product for a potential buyer. If you or someone you know is interested in owning a newer super energy efficient home with proven savings and comfort please contact the listing agent.

Uniform SEEFAR© Comparative Building Assessment Report

Total Cost of Building Ownership (TCBO)

SEEFAR©

 

 

Report TypeForm 1004A Assessment Report

Property TypeSingle Family Residential Home

Assessment Target Home:  786 Ashburn Street, Winnipeg, Manitoba

Prepared ByWayne C.T. Cole, Executive Vice-President, Analytics

       Sustainable Renewal Planning Inc. – SRP Canada

DateMay 25, 2018

 

 

 

 

Comparative Building Assessment Introduction:

 

This SEEFAR© assessment calculates and compares the TCBO between the following buildings:

 

  1. Comparative Home:  This home represents the typical home of the same size and aesthetic features as 786 Ashburn, except for the energy construction configuration design which is assumed to be typical to existing homes in the same neighborhood.  The energy configuration design of this comparative home is based on the minimum building code in existence at the time of construction, and assumes electric heat.  The comparative results would vary in cases where natural gas is used.
  2. Target Home - 786 Ashburn:  This 1,616 sq/ft home is the subject of this assessment, and was constructed in 2011 using a modified passive energy configuration construction design (low energy #87) intended to reduce energy costs and GHG emissions.  Unique features of this home that contribute to lower costs include:
    1. Higher building envelope insulation values
    2. Triple pane, low-e gas windows
    3. Sub soil heat exchanger
    4. High efficient HRV
    5. Solar thermal domestic hot water heating system

 

The SEEFAR© assessment calculates the total cost of building ownership through a process of projecting costs with an appropriate inflation indexing including:

  • Mortgage interest
  • Building insurance
  • Property taxes
  • Utilities
  • Service and maintenance
  • Age-related component renewal (like-for-like)

SEEFAR© then monetizes the total cost of building ownership savings by determining the present value of the future savings using a standard Net Present value (NPV) calculation.  The results are shown in the following Table:

 

                                                                                                   TCBO Table

Based on a ‘comparative home’ built to code when new, and in the same neighborhood, the Total Cost of Building Ownership (TCBO) for the home at 786 Ashburn Street will have lower costs that have been projected to create cumulative savings with a current Net Present Value* (NPV) embodied in value at transfer.  The TCBO is based on verified utility bills, standard industry life cycles for relevant building components, recognized maintenance costs, and age-related building component replacement costs escalated for inflation over the useful life of the building (60 years).  The TCBO for 786 Ashburn also includes interest and mortgage costs based on a $25,640 sales price premium.  Lifecycle calculations are based on current building condition.

Ownership

Term

NPV of TCBO

Savings*

Obsolescence

Rate – 50%

5 Years

$5,927

$2,964

10 Years

$14,050

$7,025

15 years

$24,210

$12,105

20 Years

$36,612

$18,306

25 Years

$51,281

$25,640

Useful Life

$172,892

$86,447

  *Based on a discount rate of 2.2%

For 786 Ashburn, the most significant factor contributing to the lower cost of building ownership is energy consumption, and the following Chart highlights the areas of difference in the energy load for each building, and the total comparative load.

Annual Energy Consumption Factors Table

Primary Energy Consumption Factors

Comparative

Home

786

Ashburn

Heating Load

73%

32%

Cooling Load

6%

1%

Ventilation Load

1%

32%

Water heating Load

13%

18%

Lighting Load

4%

7%

Appliance Load

3%

10%

Energy Use Index (kWh/m2/yr)   

177

38

The Annual Energy Consumption Factors Table is intended to provide a mathematically weighted representation of how the energy consumption is likely distributed across the main energy end-use components or functions, and highlights how the building design impacts the energy distribution and energy Intensity.  The comparative Energy Use Index (kWh/m2/yr) can be used, in part, to explain the areas of difference in annual energy consumption between the two buildings assessed, and why energy costs account for such a significant savings in the TCBO.  The energy construction configuration design of 786 Ashburn reduces energy use by 78%.

SEEFAR© is a Copyright of Sustainable Renewal Planning Inc.

Energy Consumption

Comparative Home

786 Ashburn

Savings

5 Years

$13,931

$3,677

$10,254

10 Years

$30,871

$8,049

$22,821

15 years

$51,303

$13,271

$38,032

20 Years

$76,283

$19,517

$56,766

25 Years

$106,825

$27,018

$79,807

                                                                                                                                              Cumulative Energy Cost Table

The cumulative energy costs of the comparative homes is shown in the Table to the right, at five-year time increments.  These numbers reflect an annual energy cost increase of 4.25% year-over-year.  At the end of a 25-year mortgage term, the 786 Ashburn home is projected to experience $79,807 less in costs.  Should the utility rates increase at an annual rate higher than 4.25%, the comparative savings will be higher.

 

                                                                                                                                       Cumulative Maintenance Cost Table

Cumulative

Maintenance

Comparative Home

786 Ashburn

Savings

5 Years

 $1,862

 $1,522

 $340

10 Years

 $3,867

 $3,161

 $706

15 years

 $6,028

 $4,927

 $1,101

20 Years

 $8,356

 $6,830

 $1,526

25 Years

 $10,863

 $8,880

 $1,983

The 786 Ashburn home has a lower annual maintenance cost, due, in part, to the lighter component loads and the quality of the selected energy end-use equipment.  The cumulative maintenance of the comparative homes is shown in the Table to the right, at five-year time increments.  These numbers reflect an annual inflationary cost increase of 1.50% year-over-year.  At the end of a 25-year mortgage term the 786 Ashburn home is projected to experience $1,983 less in maintenance costs.

                                                                                                                                 Cumulative Building Renewal Cost Table

Cumulative

Renewal Cost

Comparative Home

786 Ashburn

Savings

5 Years

 $-  

 $-  

 $-  

10 Years

 $14,343

 $1,080

 $13,263

15 years

 $14,343

 $1,080

 $13,263

20 Years

 $33,446

 $16,404

 $17,042

25 Years

 $38,571

 $16,404

 $22,167

The 786 Ashburn home has a lower annual building component renewal cost due, in part, to the quality of the selected energy end-use equipment.  The cumulative renewal cost of the comparative homes is shown in the Table to the right, at five-year time increments.  These numbers reflect an annual inflationary cost increase of 1.50% year-over-year.  At the end of a 25-year mortgage term, the 786 Ashburn home is projected to experience $22,167 less in building component renewal costs.

These calculations assume that both homes have been subjected to regular building component renewal based on regular age-related deterioration of the energy end-use components.  The capital costs associated with this renewal investment assumes that the components have been replaced on a like-for-like basis.  These calculations make no allowance for building modernization that may have impacted the performance of the energy end-use components.

These calculations make no provision for the number of occupants, age of occupants, or life style of occupants.  Research shows that each of these factors can impact on energy consumption, maintenance and renewal costs.  Therefore, changes in these factors could produce difference results than those projected.

To improve the comparative value of the TCBO between the homes, the mortgage interest costs have been calculated using the same rate (3%) and term (25-year), with a 20% down payment.  The market value of the Comparative Home is assumed to be $305,000 (based on a 2017 appraisal report) and the market value of the 786 Ashburn home was assumed to be higher by $25,640 – the 25-year NPV shown after applying the 50% Economic Obsolescence Rate stated in TCBO Chart on page 2.  Building insurance and taxes are calculated using the same factor for both homes and are based on the assumed market value.

The undiscounted return on investment (ROI) of the additional $25,640 capital investment allocated to 786 Ashburn is 24% over the 25-year mortgage term.

  1. Scope of Assessment:  The scope of this assessment is defined by the complexity of the assessment assignment and the reporting requirements of this assessment report form, including the following definition of the Total Cost of Building Ownership, Statement of Assumptions and Limiting Conditions.  The buildings that are the subject of this assessment are either existing, new, typical architype, or planned.  In cases where the comparative assessment is based on alternative designs of the same building, this fact is disclosed in the Comparative Building Assessment Introduction at the beginning of this report.  The assessment process used in this assessment is identical for both buildings.  In cases where the building(s) does not yet exist, or has no energy consumption history, the assumptions used are based on research and analysis of reliable public and/or private sources, and the resulting opinions and conclusions of the preparer identified on the front page of this report.

 

  1. Intended Use:  The intended use of this assessment report is for the appraiser/lender/client to quantify the comparative total cost of building ownership of the property that is the subject of this assessment for a mortgage finance transaction, or for a real-estate sale transaction.

 

  1. Intended User:  The intended user of this assessment is the appraiser/lender/client.

 

  1. Definition of Total Cost of Building Ownership (TCBO):  The TCBO includes:
  1. Energy costs based on current published rates with an annual cost escalated rate applied over the assessment term
  2. GHG costs based on current published rates with an annual cost escalated rate applied over the assessment term
  3. Annual service and maintenance costs for energy end-use components based on current estimated rates with an annual cost escalated rate applied over the assessment term
  4. Age-related energy end-use building component replacement (like-for-like) with an annual cost escalation rate over the assessment term
  5. Annual Property Taxes based on current rates with an annual cost escalated rate over the assessment term
  6. Annual building insurance costs based on current rates with an annual cost escalated rate over the assessment term
  7. Mortgage interest costs based on an assumed rate and term
  8. The TCBO used in this assessment does not include any costs associated with interior and exterior aesthetic finishes, hardware, or fixtures, and makes no allowance for building modernization or additions.

 

  1. Statement of Assumptions:  This assessment is based on a number of assumptions related to annual cost escalation rates, inflationary rates, interest rates, mortgage term, and other rates current published.  In cases where existing buildings are being assessed, actual energy costs have been used as the basis for the assessment calculations.  In cases where the assessment is being done on new or planned buildings, energy costs are based on an energy model provided by others.  Construction costs, life cycle terms, and service and maintenance costs are based on published industry information or have been provided by relevant industry experts.  Changes in any assumption(s) will change the output of the assessment, so drawing generalized conclusions from this assessment is not recommended.

 

  1. Limiting Conditions:  This assessment is subject to the following conditions:
  1. The accuracy of the assumptions provided by others are subject to error that the SEEFAR© assessment process is unable to predict.
  2. The accuracy of the assumptions used to predict cost escalation and inflationary impacts are based on current information and are subject to change without notice.  Any conclusions drawn from this assessment report are subject to error because of unpredictable changes.
  3. This assessment makes no effort to establish the Market Value of the building being assessed.  To the extent that others may use this report to establish Market Value, the full responsibility for the use of this report for those purposes rests with others.
  4. The SEEFAR© assessment is intended to provide the client with a general sense of the comparative total cost of building ownership between two building(s) or building designs.  The reliability of the SEEFSAR© report output is directly related to the reliability of data and assumption input provided or used.  Any other use of the output, beyond this stated intention, is outside the scope of the assessment and is not recommended.

 

  1. The SEEFAR© word, phrase and logo is a copyright of Sustainable Renewal Planning Inc., and all rights are fully reserved.  All intellectual property and related material or analyses that is developed or produced under this assessment, will be the property of Sustainable Renewal Planning Inc.

 

  1. Except to the extent paid in settlement from any applicable insurance policies, and to the extent permitted by applicable law, all users of this assessment report agree to indemnify and hold harmless Sustainable Renewal Planning Inc, and its respective directors, shareholders, affiliates, officers, preparers, agents, employees, and permitted successors and assigns against any and all claims, losses, damages, liabilities, penalties, punitive damages, expenses, reasonable legal fees and costs of any kind or amount whatsoever, which result from or arise out of any act or omission of the indemnifying user, its respective directors, shareholders, affiliates, officers, agents, employees, and permitted successors and assigns that occurs in connection with the use of this assessment and report.

 

 

Sustainable Renewal Planning Inc. – SRP Canada

Suite 206 – 848 Allegheny Drive, Winnipeg MB, R3T 4X2

  •                               : (204) 806-9332
  •                               :  Wayne.Cole@SRPCanada.com

Added: Thu June 14th 2018