The GHB Interview: CR Herro, Vice President of Innovation, Meritage Homes

A great green home is no longer just energy-efficient; it must be healthy, too

GREEN HOME BUILDER: Why do you think that green, sustainable homebuilding is essential to the homebuilding industry?

CR HERRO: Energy-efficient green building standards are about creating better value for homebuyers. In a competitive marketplace, better is always correct.

It has become essential to the industry because of those inspired consumers that know they can get better. They get more efficient battery life on their phones; they get more gas efficiency out of their cars. They’re becoming aware that the opportunity for them to get more efficiency from their homes means they have more disposable cash each month for their families.

As a builder we have an ethical responsibility to provide buyers with the best we can, and we have a responsibility to compete to build the best products that represent the best value.

GHB: What trends have you noticed in green homebuilding over the past few years? What changes do you predict may be on the horizon?

CRH: In recent years, fundamental energy efficiency has become commonplace. The two things that have evolved quickly are energy efficiency around home automation, and smart technology use to get the best performance through allowing the home to be adaptive to their behavior. Wi-Fi thermostats, occupancy sensors, and all the technology we’re embedding in our homes takes high-performance materials and allows them to be much more reactive to buyers’ needs to enhance their quality of life.

The next step is the association of energy efficiency and health. Buyers have started to understand that a home that’s tighter not only loses less air conditioning, but also gains less dirt and pollen. A builder that’s responsible enough to build better is likely also responsible enough to use housing materials and low VOCs, and be a more thoughtful partner in taking care of their buyers. You see third party certification programs like Energy Star® including health requirements in their standards. Energy efficiency is really expanding to include the fundamental operating cost, the comfort of the home, the indoor air quality and the occupant’s health. That’s a really positive evolution in the way people consider green homebuilding; it’s definitely an opportunity for buyers to get more, and for builders to build better than conventional code has required.

GHB: How do you think the new solar mandate will affect/has affected the homebuilding market in California and beyond?

CRH: The intentions of policymakers to require renewable energy adoption and putting it in the code is correct.

They did the right thing, but they didn’t do it well. The problem with requiring renewable energy is that there’s a cost, but they didn’t empower the transaction to pay for it. Let’s say it costs $30,000 to put in a solar system. That means it’s $30,000 more than a home built five years ago without renewable energy. The truth is, that $30,000 solar system in your mortgage is only costing you $150, and it’s making $200 of power. The problem is, the average buyer doesn’t understand the difference between the price of the home and the true monthly cost of the home.

The California Energy Commission would have better enabled the adoption of renewable energy if they had included an appraisal standard and an underwriting standard that promoted consumer awareness of the economic benefit along with the economic cost of solar.

GHB: In what ways is Meritage looking ahead to stay in the lead as one of the nation’s top green homebuilders?

CRH: The ability to use new materials and advance construction is ever on going. We constantly partner with suppliers to understand what’s in their research, what they’re bringing out, how we can help with economies of scale, and how we can pull things from the center of homebuilding.

The biggest challenge is the labor force to continue to build great, high-performance homes. We’re losing so many skilled tradesmen to retirement and they’re not being replaced with young people coming into that industry.

Our big focus is to continue to evolve the performance of our homes, and to look at new, innovative building techniques to provide those homes. We’re looking hard at panelization, modulation, and alternative construction techniques to ensure that not only do we have this great idea, but we continue to be able to enact it in the field by compensating for the changing way we’ll have to build homes in the very near future.

GHB: Did you have any additional comments to include?

CRH: Consumers should be aware that all the things that they thought may be available someday are available today. From smart, integrated technology, to integrated, renewable energy, to a quieter, more comfortable, and more healthy living environment, the things that used to only be available for the Jetson’s are in the marketplace today. [Consumers] really just need to be inspired and critical of the opportunities and choices they have to make sure they get something that is clearly better for their family.