Is a energy efficient home worth more
If a home is upgraded to be energy efficient the home is going to be worth more to whoever buys it next. A home's value could increase by $125,000 if its more energy efficient!
Sam Bendat
Updated: August 20, 2024
If a person were to buy a home and upgrade it to make the home more energy-efficient and self-reliant, would that homeowner see a return on that investment, above or below what they spent on the upgrades?
Place your bets...
Energy efficient homes are worth more
The median price of a home with energy efficiency upgrades is $125,000 higher than a home without energy efficiency upgrades.
The above data comes from a 2022 study conducted by the real-estate marketplace Domain.
The study looked at every online home listing with and without energy-efficient keywords on the property listing and grouped them accordingly.
While not the most scientific study ever conducted, it signals that either energy-efficient houses could be worth more or, at the very least, are victim to another successful gimmick used by real estate agents to jack up housing prices...
I wouldn't put it past them.
It's also worth noting that the price difference between energy-efficient houses has continued to increase. Considering that we are talking about median prices, this is also a fairly decent indicator that energy-efficient houses are indeed being more sought after.
A more recent November 2023 Commonwealth Bank study found that 71% of respondents thought that energy-efficient upgrades to a home did increase its value. With 75% of respondents said it was a must-have for their homes!
So, the mindset of wanting to be energy efficient is already out there, and the perception of increasing home values exists too.
Added bonus, energy efficient homes also sell faster
Overall, homes that market themselves as energy-efficient sell faster than those that do not. Spending less time listed online than non-efficient homes, also efficient homes get more views than their counterparts.
Overall, it is a win-win. The energy-efficient home sells for more and sells faster.
If it wasn't for stamp duties and capital gains taxes, buying a home, making it more energy efficient, and then selling it soon after would be quite the business!
State by state growth for energy efficiency
One final table shows us how each state is fairing in the desire for more energy efficiency. Across the board, it's good news for everyone.
Seemingly, prices for energy-efficient homes are higher than those for non-efficient homes across the country.
The real takeaway here should be that those considering home improvements should strongly consider making them energy-efficient improvements.
Not only do your energy bills and carbon emissions substantially decrease, but it's a highly sought-after improvement. Then when it does come time to sell the home, it's likely you will make more money than you spent on the improvement in the first place.
Are you wanting to understand your home energy?
If you're considering upgrading your home or simply want to know more about your home energy, I would love to help!
I can help you access your own energy data from your meter through a new app I am making. More providers are coming soon!
By accessing your own energy data, I can show you the patterns of your energy usage and how best to upgrade your home around your usage patterns.
If this sounds interesting, reply to this email or reach out to me, and I can help you get early access to the app.