Buildings are responsible for approximately 40% of energy consumption and 36% of carbon emissions in the EU (European Commission, 2019). Consequently, it is important to focus on reducing energy consumption and promoting the use of energy from renewable sources in the real estate sector. This study uses a hedonic model to examine the relation between energy labels and rent prices, controlling for building-specific characteristics and economic, social, demographic and locational variables. Proof of this relationship will steer more risk-bearing capital towards sustainable real estate investments and, in turn, help further reduce carbon emissions and energy usage in the building sector.
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Authors: Steve Goossens, Nils Kok and Mike Langen