By Barbara Kessler

As the sub-prime loan implosion continues to seep the red ink of bad mortgages, home builders have been seeking cover in the color green.

No, it’s not yet a Christmas party. Building starts remain sluggish across the country. But green building, that once pigeonholed province of hippies and do-gooders, is growing despite the bad news shadowing the larger real estate sector.

carsten.jpgThe U.S. Green Building Council, the nation’s largest auditor of green construction, reports that it has awarded LEED (Leadership in Environmental and Energy Design) designations to 381 houses since the council began a pilot program for residential properties in 2005. Another 10,000 houses are in the process of being built to USGBC standards.

Those numbers may be just the tip of the iceberg as homebuyers’ awareness of climate change and how they can benefit from green building grows, say builders and the USGBC, which is hosting its annual conference called Greenbuild in Chicago this week.

Green homes are projected to grow from two percent of the housing market to 10 percent by 2010, according to the McGraw Hill SmartMarket report.