The American Dream has always been to become a property owner, which in modern times, means owning a home. But homeownership is increasingly becoming a challenge for the average American as the cost of new homes and new home construction continue to rise.
The average homeowner in the US pays 25 to 33 percent of their income on their home mortgage payment. Before the housing bubble burst, banks were letting homeowners buy homes with mortgages that accounted for 45 percent of their income. As a result, homeowners are having trouble paying for their homes. What’s more, other commodities used in the home are also getting more expensive, such as energy, water, food, and gas. All of these factors contribute to the fact that homeownership is becoming increasingly difficult for the average American.
One way potential homeowners can keep expenses at a minimum is by keeping home energy performance in mind when looking at buying an existing home or building a new one. The latest home and construction technologies and retrofits can help homes perform better, require fewer repairs, and save homeowners money; not to mention reduce a home’s ecological impact.
The average household could save nearly $3,900 by 2030 by adopting simple efficiency provisions, according the American Council for an Energy Efficiency Economy. And it is not just single-family homes that could see huge savings; energy efficiency upgrades in existing multifamily buildings could save building owners and residents up to $3.4 billion nationwide.
People already pay attention to energy performance to some degree. Most people look at a home’s utility bills when considering a mortgage. Houses on the market often publish their monthly energy utility bills to give people a better idea how much their monthly payments will be on top of the monthly home mortgage payment. But few people realize how important this number can be for long-term savings.
For example, when looking at a home that has an unusually high energy bill, the house is probably inefficient. As energy prices continue to rise over the next decade, inefficient homes will cost homeowners even more money every month to maintain. The typical U.S. family spends at least $2,000 a year on home utility bills. Energy efficiency improvements alone can reduce this energy bill by 25 percent, according to the Department of Energy. For every dollar invested in efficiency, the homeowner saves $4.00.
Energy efficiency improvements to a home can also make on-site energy generation systems provide more significant savings. For example, solar photovoltaic systems, solar hot water systems, geothermal systems, and other on-site systems, can provide a higher percentage of a home’s energy needs after energy efficiency improvements. Reducing energy-use will allow onsite systems that previously covered only 25 percent of a home’s energy needs to now cover nearly 50 percent of its energy needs.
More efficient houses also are much easier on HVAC systems and appliances, which can save the homeowner money over the long-term. Heating and cooling systems, by far the largest energy-users in a home, do not have to work as hard to heat and cool a home. This adds life to the HVAC system and they require fewer repairs, saving the homeowner time and money.
In addition to looking for homes that are already energy efficient, new homes should be built with energy efficiency in mind. It is much easier to get the most energy efficiency potential out of a home when it is built from scratch because the architect can design a home from the beginning with efficiency in mind. Home orientation, window and door placement, smart home area networks, on-site generation and other home features can all be maximized for efficiency during home construction. Taking efficiency into consideration during homebuilding can save thousands of dollars in home upgrades later.
One way homeowners can ensure their homes will be built efficiently is to build a prefabricated or modular home. Prefabricated homes are built, at least partially, in a factory, which makes them more efficient than custom-built homes. The walls, flooring and some finishes arrive in a box and fit together with a tight seal. Because large portions of the home come pre-assembled from the factory, there is less human error in construction, which reduces home leaks and can vastly increase the energy performance of a home.
Whether you are building a new home or buying an existing home, paying attention to its energy performance can be a critical component to making the home affordable in the future as the costs of homeownership rise.