A home is generally one of the largest assets any person has. Although many have begun to shy away from homeownership because of the costs of upkeep, owning a home can still a great way to build equity and personal net worth. However, over the years, it is understandable to see why so many homeowners are able to see their home as more of a money pit than an asset as age and required maintenance catches up to it. Fortunately, most of these problems can be minimized if you buy a house for the right reasons to begin with.
Many homeowners have begun to pour thousands of dollars into their homes to update and renovate their homes to modern standards, but many aren’t choosing the right type of updates. Even the necessary updates they are choosing simply aren’t getting the most out of every dollar spent. A strong update that is worth the investment is one that will not only reduce your cost of owning a home in the long run, but will also increase the home’s resale value. A few of these types of investments include:
Choosing to power you home with a renewable form of energy is definitely an investment. Geothermal and solar power energies are by no means cheap to install, with many systems costing between $15k and $30k. However, cheaper and just as efficient forms of solar power are becoming more readily available, and the special tax breaks and grants offered by both state and federal governments make the initial price tag a little more feasible.
The reason why choosing to update your home with renewable energy sources is well worth the investment is because of the savings it can provide you in the long run. With renewable sources, your utility bills will plummet, your home’s overall value will increase, your taxes will be lower, and your home’s resale potential will skyrocket. All in all, investing in renewable energies is the best investment you can make in your home. Yes, the initial costs can be steep and it may take a number of years to break even, if you plan on staying there for the long haul you will no doubt reap the rewards.
Reroofing a home is a necessity that nearly every homeowner faces at some point or another. While it can seem like an expensive hassle, reroofing your home with the proper materials can greatly reduce the amount of energy you use each month and can significantly increase your home’s selling power.
When you reroof your home, don’t choose cheap materials. You truly do get what you pay for when it comes to roofing materials and labor. Make sure that you choose quality materials, such as metal roofing or recycled synthetic shingles, which will create less waste and have greater durability. You also want to make sure that you are hiring a roofer that is highly recommended and experienced so that your roof is truly as money saving and efficient as possible.
Insulation, Weather Stripping, and Windows
Old windows, poor insulation, and lacking weather stripping can all the similar effects on your utility bill as a faulty roof can. If these parts of your home are simply old or lacking in thickness, you can easily be wasting several hundred dollars a year in utilities.
While weather stripping is an inexpensive fix, new windows and insulation rarely come with a cheap price tag. However, tax breaks are available to those who update their homes with energy saving windows and insulation which is a nice perk. New windows in particular enhance a home’s value and can significantly reduce your electric bill. Insulation, on the other hand, which isn’t always a visible update can also prove a strong selling point for your home, and will also be sure to decrease your monthly utility bill.
While updating your home to be more energy efficient is definitely a great way to go green and save money, you only want to do the aforementioned updates if you intend to stay in your home for a long time due to the high costs. You will see savings immediately because of your lower utility bills, and while it will take time for your updates to pay for themselves, that repayment period could be in as little as a couple of years. What’s that in the lifetime of a home?
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Filed Under: Real Estate
About the Author: Jeremy Vohwinkle is a Chartered Retirement Planning Counselor® and spent a few years working as a financial planner. Today, he helps people make the most of their money by writing about personal finance here and elsewhere on the web. Jeremy is also Coach at Adaptu and a regular contributor for other publications such as Intuit, and American Express. Be sure to follow Jeremy on Twitter or Google+.