What to Know About the HERD Ordinance in Ann Arbor

If you’re buying or selling a home in Ann Arbor, there’s an important new requirement you need to be aware of: the Housing Energy Rating Disclosure (HERD) ordinance. Designed to improve transparency around home energy efficiency, this policy impacts how homes are listed and marketed in the city. Whether you’re a seller preparing to list your home or a buyer looking for an energy-efficient property, here’s what you need to know.

What is the HERD Ordinance?

The Housing Energy Rating Disclosure (HERD) ordinance, passed by the Ann Arbor City Council, requires home sellers to disclose their home’s energy efficiency rating before listing their property for sale. The goal is to provide buyers with better information on energy costs, encourage energy-efficient upgrades, and support the city’s commitment to carbon neutrality.

Under this ordinance, homes will receive an energy rating that helps buyers compare energy efficiency between properties, much like an MPG rating for cars. This rating will factor in elements such as:
✅ Insulation and air sealing
✅ Heating and cooling systems
✅ Windows and doors
✅ Appliances and lighting efficiency

How Does the HERD Ordinance Impact Home Sales?

For sellers, the HERD ordinance means that before listing a home, you’ll need to obtain an energy assessment from a certified professional. This rating must be included in the listing, similar to how square footage and property taxes are disclosed.

For buyers, the HERD rating provides an objective measure of energy efficiency, helping you make informed decisions about long-term utility costs and potential upgrades. A high energy rating can signal a well-insulated home with lower energy bills, while a lower rating may indicate areas where improvements could be made.

What Do Buyers and Sellers Need to Do to Comply?

📌 For Sellers:

  • Schedule a home energy assessment before listing.
  • Include the energy rating in the home’s listing details.
  • Consider making cost-effective upgrades to improve your rating (such as sealing air leaks or upgrading insulation).

📌 For Buyers:

  • Review the HERD rating when comparing homes.
  • Factor energy efficiency into your decision-making process.
  • Ask about available incentives for energy-efficient home upgrades.

Why Energy-Efficient Homes Matter in Ann Arbor

With rising energy costs and growing environmental awareness, energy efficiency is becoming a top priority for homebuyers. Here’s why it matters:

🌿 Lower Utility Bills: Homes with better insulation and efficient heating/cooling systems cost less to operate.
🌍 Sustainability: Energy-efficient homes contribute to reducing Ann Arbor’s carbon footprint and support the city’s A2Zero climate action plan.
🏡 Increased Home Value: Studies show that energy-efficient homes often sell faster and at higher prices.

Navigating the HERD Ordinance With an Experienced Realtor

As an Ann Arbor real estate expert, I stay up to date on local policies like the HERD ordinance so I can guide my clients through the process seamlessly. If you’re thinking about selling, I can help you understand what improvements might boost your energy rating and increase your home’s market appeal. If you’re buying, I can help you evaluate listings based on energy efficiency and long-term savings.

📩 Want to learn more? Let’s chat about how the HERD ordinance impacts your real estate plans!

 

Regards,

Sheila Hoeft