THE IMPACT OF “GREEN” BUILDING CERTIFICATION ON HOUSING COSTS: THE ISRAELI EXAMPLE

ABSTRACT Apartments in certified new buildings command higher prices than similar apartments in uncertified ones. The price difference is the “green premium.” This study surveys the spatial dispersion of green building and the evolution of green premia in Israel over six years, using document analysis and interviews to understand the changes. This article presents three important findings. The first is that the number of green apartments in Israel have substantially expanded but have remained concentrated in higher socio-economic status municipalities. The second finding is that green apartments still realize a green premium, albeit a lower one, some of which persists after apartment resale. The third finding is that certification scores do not necessarily have any relation to energy efficiency. This paper documents the findings and discusses their implications.