Depending on who you ask, this year is either the best or the worst to sell your home… as usual.
The real estate market experiences bumps and dips just like every other market, and this will likely never change. But the homes most impacted by these fluctuations are typically the less desirable dwellings—they will sell faster in a boom market and languish longer in a slump.
Desirable homes will always move because they make the stressful, time-consuming and expensive process of moving so much easier!
If your home is currently on the market but hasn’t sold or you are contemplating listing this year, find out which energy efficiency upgrades can really make an impact on how quickly your home sells!
Why Energy Efficiency Is King in Residential Real Estate
Residential customers continue to report an ever-widening gap between household net income and annual energy and utilities expenses.
Let’s take the last eight years as an example. Energy costs across Canada rose by 34 percent—except in Ontario, where they rose by a whopping 71 percent. If that isn’t bad enough on its own, prices for electricity more than doubled at a time when annual net income remained stagnant.
In Toronto, homeowners reported spending an average of $201.23 per month on hydro. On average, families in Ontario spent $60 more than families living in any other province throughout Canada.
So it just makes sense that families shopping for a home anywhere in Canada, and in particular Ontario, want to make sure they can afford to keep the lights on once they move in! This makes energy efficiency upgrades king in the current residential real estate market.
Which Energy Efficiency Upgrades Can Boost Home Buyer Interest
With statistics like these, it is fairly safe to say all energy efficiency upgrades will be of interest to a potential home buyer.
In fact, Consumer Reports states that energy efficiency is second only to community safety ratings on the majority of homebuyers’ priority lists.
However, certain upgrades can more easily be quantified into immediate energy savings. These are the upgrades most likely to kindle a gleam in a homebuyer’s eye.
Energy efficient windows
The Financial Accountability Office of Ontario states that the average Ontario homeowner spends $2,358 on energy annually.
According to Energy Star, upgrading your home’s windows to high efficiency Energy Star-certified windows can save anywhere from 7 to 15 percent on annual energy bills.
So right away, your buyer stands to save from $165 to $353 just from purchasing a home with energy efficient windows installed.
New HVAC system
It is true most buyers don’t eagerly anticipate the part of their home tour where they get to view the HVAC unit. But what will grab a buyer’s attention straightaway is mentioning that the air conditioning and heating has been recently updated.
For first-time homebuyers in particular, it can be especially important to control for major expenses going in. Being able to purchase a home where the HVAC system is brand-new and still under manufacturer warranty is thus a huge plus for this category of buyers in particular.
Another huge perk that comes from an HVAC upgrade is an immediate boost in energy efficiency.
Let’s say your current furnace has an AFUE (annual fuel utilization efficiency) rating of 80. You upgrade your furnace to a new energy efficient Energy Star-certified unit that has a 96 AFUE rating.
Right there, you have reduced HVAC energy purchases for your prospective buyer by 16 percent annually—a potential power bill savings of $377.
While wired homes are a thing of the past with the advent of affordable wireless technology, “smart” upgrades are visibly in demand.
Simple programmable systems with remote (mobile or tablet) access control make managing today’s variable, active family life easier and more affordable.
Better still, one research survey demonstrated how power savings can be up to 18.7 percent with effective use of smart home technology. This represents a potential annual energy savings of $440 per year.
Weather stripping, insulating and sealing
If you thought light bulbs were not glamorous, try weather stripping! But today’s homebuyers are often surprisingly knowledgeable about insulation grades, weather stripping, sealing and other energy efficiency aids.
Energy Star estimates that simply insulating and sealing your ductwork can boost annual energy savings by up to 20 percent or more.
Energy Star states that, on average, residential customers spend 29 percent of their annual energy budget on heating and 13 percent on cooling, adding up to 42 percent. This means a 20 percent savings would be $198 per year.
Replacing standard light bulbs with long-life, highly efficient LED lighting can measurably trim lighting costs.
One study comparing incandescent and LED bulbs showed a clear cost difference of $170 over two decades.
It might not seem like much until you consider that the average lifespan for a $1 incandescent light bulb is 1,200 hours and the average lifespan for an $8 LED bulb is 25,000 hours! That is a lot of light bulbs your new buyers won’t ever have to purchase or change.
Adding Up the Energy Savings
So now let’s take a look at how much your homebuyer stands to save during their first year after move-in day if you make each of these energy efficiency upgrades: $1,385.
If you recall, the average Canadian homeowner reports spending $2,358 per year on energy costs. With a savings of $1,385, the energy efficiency upgrades you just made trim away more than half of their household utility budget starting on day one!
Get in Touch
Do you need some expert guidance on maximizing the potential resale value of your home by improving its overall energy efficiency and reducing its carbon footprint? We can help!