Can increasing your home’s energy efficiency raise its market value? The short answer is “Yes!’
In a new set of studies reported by E, the environmental magazine, the experts at Energy Star found that an eight percent increase in home value correlated with Energy Star certified homes across Oregon, Idaho and Washington simply because they were deemed energy efficient.
The same pattern has been observed across the U.S. A six percent increase was seen in the final price tags of Energy Star certified homes in Texas, and a 5% increase in market value was charted in Maryland.
The Journal of Urban Economics concluded that with every 10 per cent increase in energy efficiency, a home’s market value increases by approximately 2.2 per cent.
Why is this happening? To put it simply, the average home buyer has become savvier about energy efficiency. The National Association of Realtors (NAR) reported that 51 percent of agents said that clients were interested in sustainability. In a related report, stats showed that 83 percent of home buyers desired more efficient windows, 81 percent wanted more efficient appliances, and 80 percent wanted more efficient lighting.
It’s no surprise that homeowners have come to understand that energy-efficient upgrades translate into lower energy costs. According to the U.S. Department of Energy, the average family spends approximately $2,200 annually on energy bills. Thirty percent of that cost can be removed just like that through energy-efficient home modifications.
Homeowners are also being driven by a sense of personal responsibility. A sweeping study covering 17 countries and 10,000 participants revealed that a paradigm shift in purchasing habits was occurring. Eighty-five percent of respondents reported that they had changed their spending habits over the past five years to accommodate a greener lifestyle. In addition, one-third of the population is willing to spend more for sustainable products or services—as much as 25 percent!
If you’re feeling the same inclination, there are many ways to upgrade your home’s energy efficiency: Insulating walls is usually where people begin, but sealing air leaks (even the small ones!) with caulking, spray foam and weather stripping can save anywhere from five to 30 percent on energy. Ducts specifically are known to have leaks that can cause losses of as much as 60 percent of the heated air traveling through them. Energy efficient light fixtures, windows, doors, skylights, appliances and hot-water heaters are all available for purchase these days, and when used in connection with programmable thermostats and smart-device timers, a surprising amount of money can be realized in energy savings by the end of the year. [DHC]