Realtor Forecasting Accuracy on Homebuyer Preferences for Energy Efficiency

Abstract Residential energy use is a major contributor to total energy consumption and CO 2 emissions, and energy costs can take up high shares of household spending. In this context, we make three contributions to the literature. First, using a discrete choice experiment with 1,389 prospective homebuyers in Sweden, we investigate how homebuyers account for energy efficiency of buildings compared to other attributes when looking for a new home. Second, we elicit forecasts from a sample of 252 realtors whom we ask to predict homebuyers’ preferences, allowing us to shed light on the role these important mediators play regarding energy efficiency in the housing market. Third, we estimate how providing prior information on homebuyers’ choices affects realtors’ forecasting accuracy. For homebuyers, we find that energy efficiency ranks low overall. Realtors’ forecasting accuracy is lower for the energy efficiency attribute. Providing realtors with more prior information has sizeable positive effects on forecasting accuracy, and information also affects self-reported difficulty of and confidence in the forecasts.