Home improvements that will lower ownership costs
Sometimes you’ve got to spend money to make money. That adage often holds true in investing or starting a business, and can also be valid when owning a home after you’ve gone through all of the trouble of getting a home loan.
Electricity, gas, water, maintenance and other costs of running a house can be expensive, and can be especially costly if you own an older home or a historic home that needs updating. A relatively new home can also be expensive to maintain.
If you’ve got the upfront money to pay for a few home improvement projects, they can pay for themselves in savings over time.
The costs of some improvements can be lowered through state and federal tax credits.Here are some of the best home improvements to make that will lower homeownership costs in the long run. Some of the larger ones may cause you to take out a home equity line of credit to afford:
The average home spends around $2,000 per year on heating and cooling. A smart thermostat can help save around 15%, or $300, of the annual cost, says Jared Weitz, CEO and founder of United Capital Source in Great Neck, NY.
A Nest thermostat costs about $200. For $25, a seven-day thermostat that’s sold at most hardware store can accomplish most of the same savings, says Dan Meyer, co-founder and CEO of Pocketdoor, a company that helps homeowners organize home projects.
“The investment for this is low,” Weitz says. “A Nest thermostat costs around $200 and will help drive this 15% savings.”
Switching a 1990s era washing machine for a new one can save a family an average of $100 per year and 40% water reduction, Weitz says. That doesn’t sound like much, but swapping out an old dryer, dishwasher, toilets and other things for ones that are more energy and water efficient can add up.
“Be sure to look up what rebates apply to what appliances in your state before making the purchase,” Weitz recommends. “They do vary, so time the purchase of your unit to when the rebate is offered.”
Toilets that have the WaterSense label save the average family of four $110 per year and $2,200 over an expected lifespan of 20 years, according to the EPA. Low-flow faucets can reduce tap water usage by up to 30%, and low-flow shower heads can reduce shower volume by up to 70%, according to the Department of Energy, or DOE.
Using less water can also lower energy costs, since you’re using less electricity or gas to heat the water. The DOE says that the average household spends $400 to $600 on hot water heating per year.
Help your air conditioner out
From cleaning and changing your air conditioner filters to getting rid of a window AC for a swamp cooler, and planting trees next to your home, there are many ways to reduce your home’s electricity use and still keep your home cool.
Air filters are cheap, and replacing a dirty filter with a clean one can reduce air conditioning costs by 5% to 15%, according to the DOE.
Ceiling fans keep the cool air from an AC down where you can feel it, and just a simple portable fan can be enough to cool a room. Bryan Stoddard, a homeowner in Jersey City, N.J., who runs a website called Homewares Insider, says a $40 portable fan helps him use the AC less in the summer.
Stoddard also replaced the blinds on his home’s windows after learning that using curtains can lower indoor temperatures by about 20 degrees. He expects to lower his electricity bill by 8%.
To potentially drop your electric bill significantly, a rooftop solar system can help. Derek Hales, a homeowner in Phoenix and editor-in-chief at ModernCastle, says he and his wife spent $27,000 on a solar system, though the cost dropped to $18,900 after a 30% federal tax credit.
Their average electric bill dropped from around $250 a month, or $3,000 annually, to about $30 monthly, or $360 annually, with solar power.
Hannah Wiegard and her husband had solar panels installed on their three-bedroom home in Arlington, Virginia, and expect it to offset about half of their energy us each year, with the panels paying for themselves in about 13 years. “It’s got a direct dollar benefit,” Wiegard says, “but also an immeasurable benefit where we truly feel we are creating our own clean energy and reducing dependence on polluting energy sources of the past.”
Another thing the Hales did after buying their home almost four years ago was install a 40-by-25 foot section of artificial turf to cover about half of their backyard. It cost $5,500, but allowed them to avoid maintenance, lowered watering costs and they didn’t have to buy or hire lawn equipment.
Hale said it would have cost about $100 per month to water and take care of such a lawn, putting their break even point on the turf at 4.6 years. They expect to get the $5,500 back when they sell the home by getting added value to the home sale price from the artificial lawn.