Energy-efficient properties used to be just a “nice to have” but these days they’re quickly becoming one of the most important considerations for homebuyers.
And that’s where it matters to you…
Properties that have strong energy credentials sell faster, for more money, and they cost a lot less to run. If you’re looking to make your current home more efficient or you’re looking for something new, it’s important to know which features add real value and which are just a waste of money.
The good news is that with the right energy-efficient upgrades, you can transform both your utility bills and your property’s market value.
Here’s what you’ll learn in this guide:
- Why Energy Efficiency Adds Value to a Property
- The Most Cost-Effective Energy-Efficient Features
- How Insulation Impacts Your Profitability
- Smart Technology That Pays For Itself
- Quick Fixes That Give Instant Savings
Why Energy Efficiency Adds Value to a Property
We’ll just cut to the chase…
Energy efficiency has a direct impact on how much buyers are willing to pay for a property. According to this article from the National Renewable Energy Laboratory, every $1 worth of home value increases for every $1 saved on energy bills. That’s a pretty exceptional return on investment for something that is a relatively simple upgrade.
It also has to do with the fact that buyers want property that costs less to run.
Heating and cooling account for the majority of home maintenance budgets. When a property can show that its running costs will be lower, it’s going to be a much more attractive purchase for buyers.
Think about it this way…
You have two identical properties, both going on sale at the same price and at the same time. They are physically the same size, have the same fixtures and fittings and are in the same general location. The only difference is that one has poor insulation and old windows, while the other one is filled with modern energy-efficient properties.
Which one do you think will sell first?
It’s not a hard decision.
The Most Cost-Effective Energy-Efficient Features
Not all energy-efficient upgrades are the same. Some features have exceptional value and others are not about financial return but more about personal comfort.
So here are the features you need to know about:
Insulation
Quality insulation is the base of any energy-efficient property. This applies to every property and to garden buildings too, like insulated log cabins which have become more popular in recent years as offices and studios that are used throughout the year.
The U.S. Department of Energy says that heating and cooling can account for nearly 50% of a home’s energy use, so improving this with high-quality insulation will directly cut this large expense.
Energy-Efficient Windows
Windows can be a weak point in any property’s thermal envelope. Up to 30% of heating and cooling energy use in residential buildings is lost through windows.
Buyers will look for windows that have been double or triple-glazed to cut energy consumption. And, as mentioned previously, they are willing to pay for it.
Smart Thermostats
What was once considered a luxury is now a necessity. Smart thermostats can learn your habits and adjust accordingly to lower energy use when you don’t need it while still keeping you comfortable.
The technology pays for itself through energy savings.
How Insulation Impacts Your Profitability
Here’s the good stuff…
Insulation upgrades are one of the best returns on investment for any home improvement. The statistics back this one up 100%.
According to the Environmental Protection Agency, homeowners can save an average of 15% on heating and cooling costs simply by adding insulation and air sealing their homes. This means lower outgoings every month from the first day.
But it doesn’t stop there.
Properties with superior insulation will also benefit from the following:
- More consistent temperatures inside the property
- Lower strain on the HVAC system
- Better noise reduction
- Improved air quality
- Longer equipment life
Insulation usually pays back its own cost within a few years. After that, you start to keep the money.
Another thing to consider…
The government in many countries offers tax credits for insulation improvements. In the US, homeowners are eligible for a tax credit of up to $1,200 per year for qualifying energy efficiency improvements, including the cost of the insulation materials. It’s a government incentive to make upgrades more financially appealing.
Smart Technology That Pays For Itself
Technology is rapidly changing the way we consume energy in our homes. The best smart home technology doesn’t just make things more convenient. It actively reduces waste and cuts costs.
Smart Lighting Systems
LED lighting has already made a huge impact as it uses up to 90% less energy than traditional light bulbs. Combining this with smart technology and being able to control it all on your smartphone takes savings even further by ensuring that lights are only on when they are needed.
On average, households that switch to LED lighting save around $225 a year.
Automated Climate Control
Going one step beyond smart thermostats, whole-home climate systems can have different zones that heat and cool to match actual usage patterns. Rooms that aren’t being used aren’t heated or cooled, and spaces that are occupied are kept at a comfortable temperature.
Systems like this can reduce heating and cooling costs by 10% or more compared to standard equipment.
Solar Integration
Solar panels have become dramatically more affordable over the last ten years. The price has dropped by 70%, with an average system that used to cost $40,000 now averaging $25,000 and heading even lower.
The average payback period for owned residential solar is around 6-10 years. After that point, electricity is essentially free.
Quick Fixes That Give Instant Savings
Some improvements don’t have to cost the earth to be effective.
If you want to get immediate energy savings, start with these:
- Seal air leaks around windows and doors
- Add weatherstripping to exterior doors
- Install LED bulbs
- Use smart power strips to kill phantom loads
- Set your water heater to 120°F maximum
- Clean or replace HVAC filters monthly
These are all steps that can make an immediate impact on energy waste. They also cost less than $100 in total and can be done over a weekend.
There’s no need to wait for the “perfect” time to make these improvements. Start now, and start with the smaller steps.
Making it All Work Together
The important thing to know is this…
Energy-efficient features are all individually great. But they are at their most valuable when they are working together as part of a cohesive system. Well-insulated homes with efficient windows, smart climate control and LED lighting are going to deliver a greater combined value in terms of energy efficiency and waste reduction.
When you are looking at properties, or planning improvements for your own home, take the whole picture into account.
Ask how the individual features work together. A top-notch HVAC system is going to struggle in a property that has poor insulation, and smart thermostats can only do so much to cut costs if you have leaky windows.
The properties that will attract the highest premiums will be those that combine multiple energy-efficient features into a package.
Wrapping it Up
Energy-efficient properties save money each month and have a higher market value. The most important energy-efficient features are quality insulation, energy-efficient windows, smart home climate control, and renewable energy integration.
Just to summarize:
- Heating and cooling cost can be cut by up to 15% simply by adding insulation and air sealing
- Property values go up by $20 for every $1 saved on energy bills
- There are government tax credits that make improvements more affordable
- The simple improvements will give you the most immediate return
There is no time like the present to improve energy efficiency. The longer you leave it, the more money you will be wasting on needlessly high utility bills. Start with the quick wins and then work toward the bigger improvements as your budget allows.
Energy efficiency is not only good for the environment, it’s one of the smartest financial decisions a property owner can make.
