Avoid Buyer’s Remorse: 6 Critical Energy Efficiency Questions Homebuyers Should Ask

Learn the energy efficiency questions home buyers should ask before deciding on a new home.

Don’t get stuck buying a home with thousands of dollars in hidden costs! Learn about the energy efficiency questions homebuyers should ask to find your dream home.

Shopping around for a new home can be an incredibly stressful experience. Even when we’re not living through a global pandemic! There are all kinds of factors you need to consider. They range from the most obvious—like price and location—to the more subtle, such as school district and expected resale value. One consideration that may also often slip a buyer’s mind is the expected energy efficiency of their new home. There are certainly things you can do to a home after you buy it to improve its energy efficiency. But these fixes can be costly. It’s better to know exactly what you’re getting yourself into before you end up stuck with a more expensive purchase than you’d anticipated.

Some cities and states are beginning to require that sellers disclose a home energy audit when they list their homes. For example, Portland, OR requires sellers of most single-family homes to obtain and disclose a Home Energy Score at the time of sale. And Austin, TX has passed a similar Energy Conservation Audit and Disclosure Ordinance.

But most municipalities do not have such requirements. And energy efficiency rarely enters the decision-making process, despite the fact that it can have major financial implications for homebuyers. If you aren’t sure of the first place to begin when gauging a prospective home’s energy efficiency, you’re not alone!

But don’t worry! In this article, we’ll guide you through six critical energy efficiency questions homebuyers should ask as part of their search.

Investing in an energy-efficient home will necessitate a couple trade-offs but can provide extensive long-term benefits.
A certified energy-efficient home may require a couple trade-offs up front but can provide extensive long-term benefits. Source: Fran Hogan.

The Benefits and Trade-Offs of an Energy Efficient Home

First, let’s dive a little bit more into the potential benefits and trade-offs of seeking out an energy efficient home.

Lower Your Monthly Bill

The most obvious benefit of an energy-efficient home is the decrease to your monthly power bill. On average, a U.S. household will spend around two to three percent of its annual income just on their home electricity bill. That equates to a monthly bill of around $100 – $150 depending on where you live. Choosing an ENERGY STAR certified home alone can shave as much as 15 percent off that bill.

Lower Your Environmental Footprint

Of course, there are other benefits too. For example, energy-efficient homes are better for the environment since they require less power to execute the same functions. These benefits also mean that energy efficient homes tend to have higher resale values. In fact, the average home buyer indicating they’d be willing to pay over $8,000 more for a home demonstrating reduced energy costs.

Higher Upfront Costs & Design Limitations

Unfortunately, energy efficient homes do come with two major trade-offs. The first is simply an issue of reduced choice. Taking energy efficiency seriously might mean turning down your otherwise perfect dream home. The second is a matter of up-front cost. Energy-efficient homes will save you money in the long-run thanks to lowered electricity costs. But they can cost five to 10 percent more to build than their less efficient counterparts. We believe the benefits well outweigh these trade-offs, but you should do what feels right for your situation.

Six Energy Efficiency Questions Homebuyers Should Ask

If you’re willing to accept these trade-offs in exchange for the overall benefits, then the next thing you’ll likely want to know is how to go about finding your ideal energy-efficient home. To get you started, we’ve gathered six key energy efficiency questions homebuyers should ask. Get answers to these questions, whether by asking directly or through your own observations of the home, and you’ll have everything you need to evaluate whether your next house will make for a financially savvy, energy-efficient purchase.

1. Do you have experience with energy-efficient homes?

This first question is primarily directed at anyone working through an agent or realtor to assist in purchasing a home. While it’s not necessary that your agent has experience specifically shopping for homes with energy efficiency, it can certainly help. If they do, they’ll likely know exactly what to look for and can save you plenty of hassle by cutting right to the point. Whenever possible, try to seek out such agents to simplify your search.

Conversely, if you plan to look at home listings yourself, search for any keywords likely to signify a home’s energy efficiency. Some less-obvious examples include green, efficient home, and high-performance home. You might also keep an eye out for newer homes since they are more likely to be energy efficient than older houses built before modern regulations and standards.

2. Does your home have any energy efficiency certifications?

One of the first energy efficiency questions home buyers should ask is whether a home has any certifications.

Another simple way to get a general measure of a home’s energy efficiency is by looking at any energy efficiency certifications it has received. One of these comes from a program many are already familiar with: ENERGY STAR. To receive this certification, a house must meet a set of minimum standards defined by the Environmental Protection Agency. This includes requirements such as the use of effective insulation, high-performance windows, and efficient heating and cooling equipment.

Other common certifications and rating systems include U.S. Green Building Council LEED rating system, designed to promote the construction of high-performance homes; the U.S. Department of Energy’s Home Energy Score; and the Residential Energy Services Network’s Home Energy Rating System. Various states or regions may also have their own local certifications, such as the Colorado Green Building Guild. Do a bit of research into the area where you are purchasing a home to see what certifications are most common. If you see a listed certification with which you are unfamiliar, look it up so you know exactly what it requires. Even if you don’t see certifications listed, make sure you ask about it. Some sellers may not think to mention it unless it comes up.

3. What does your electricity bill look like?

Looking at previous electricity bills for a prospective home can tell you a lot about how much you should expect to spend each month on power. A high electricity bill can be a huge red flag. Even if it’s not enough to scare you off, it can at least lead to follow-up questions about the sources of those energy expenses. Parsing an electricity bill isn’t always easy. If you want a better idea of what to look for, we’ve got some pointers for you to accurately read a utility bill and identify key drivers of energy use in a home.

4. Is your home well-insulated?

A home’s insulation plays a critical role in determining its overall energy consumption. A poorly insulated house can allow cold air or heat to flow freely between the inside and outside. There are a couple of ways you can check the general quality of a home’s insulation. First, ask to look at interior pipes and inquire about any issues with them freezing. Second, keep an eye out for any drafts, dramatic changes in temperature between rooms, or signs of water leakage. Finally, try placing your hand against the interior walls, floors, or ceilings. If they feel cold or damp, that could be a sign of some problem with the insulation.

Homebuyers should make sure to look beyond the decor to investigate windows for leaks, as they can make or break a home's energy efficiency.
Make sure to look beyond the decor to investigate windows for leaks, as they can make or break a home’s energy efficiency. Source: Colin Maynard

Windows are also a common source of drafts or air leakage. They can be responsible for up to 30 percent of heating and cooling loss. Make sure to look beyond the decor and investigate the windows in the house. More specifically, check for any obvious signs of poor insulation such as the feeling of air coming in around the edges. If you want some additional tips to address window insulation, you can read about it more in depth here.

5. How efficient is the HVAC system?

HVAC stands for heating, ventilation, and air conditioning. Every home has some version of an HVAC system set up that is responsible for controlling its indoor temperature. You’ll want to investigate that system to get a sense of the quality of its components and its ENERGY STAR rating. Newer or more expensive equipment is likely to run more efficiently. Additionally, consider how well maintained the equipment is since that can play a large role in its overall efficiency (and maintenance costs!). For more advice on creating an energy efficient environment to optimize your HVAC system, check out this article here.

6. What appliances, bulbs, and smart home devices are included?

Finally, it’s worth investigating any appliances that come with the house to gauge their energy efficiency. A house that includes a lot of appliances might seem like a great bargain. But if those appliances will waste electricity, they might end up being a hassle more than a boon. Look for signs that each appliance is energy efficient, such as by comparing its energy usage against your current appliances or by looking for an ENERGY STAR logo. It’s also worth asking about any installed smart home devices, such as smart thermostats, that might help cut down on unnecessary power expenditures.

Among the energy efficiency questions homebuyers should ask are what smart elements a home has. Source: Dan Lefebvre
Among the energy efficiency questions homebuyers should ask are what smart elements a home has. Source: Dan Lefebvre

As part of this effort, don’t overlook the house’s current lights. LED bulbs can use up to 80 percent less energy and last up to three times longer than traditional lightbulbs. Spread across all the lights in your house, this combines to considerable potential savings. This is of course an easy switch, but it’s so much easier if your home comes equipped with these electricity- and money-saving bulbs! We have some additional guidance on energy efficient lighting if you want to learn more.

Invest in Energy Efficiency Now, Avoid Regrets Later

With these six energy efficiency questions homebuyers should ask, you now have everything you need to evaluate whether your next house will meet your energy efficiency standards. Of course, it’s up to you what to do with the information you receive and to decide what concessions you might be willing to make. At the very least, you’ll have the peace of mind that comes from knowing all the relevant facts. And you’ll avoid any unpleasant surprises after the papers are signed and the moving trucks have come and gone.

Whether or not you’re currently in the market for a new home, there are plenty of other things you can do to bring your power consumption down in your current abode. This might involve anything from switching up your spring cleaning regimen for energy savings to investing in energy-efficient upgrades. And if you want to make sure you’re doing everything you can to save money while boosting your energy efficiency, consider subscribing to our blog so you never miss out on any of our recommendations!

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  • Will Johnson , July 6, 2020 @ 1:24 pm

    Most realtors, lenders and appraisers are unprepared to address energy efficiency in homes. A poor energy efficient home can lead to comfort issues, higher utility bills and health/safety conditions. Conversely , thanks to building code aggressive improvements for energy efficiency, newer homes may not be recognized for it’s high energy efficiency.

    • Sarah , July 7, 2020 @ 12:05 am

      Very true. Making it that much more important for home buyers to be educated about the right questions to ask in order to ensure they know what they are getting!

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