Creating an Energy Efficient Rental Property
If you are looking for effective ways to make your rental property stand out in the market, the best way to do it is by turning your property into an energy efficient rental property. There are a number of benefits that are readily apparent when you go green with your property:
- You attract more renters because you lower their utility bills
- Some states will give tax breaks when you go green
- You minimize your dependence on utility companies
- You are doing your part to help save the planet
The best part is that creating an energy efficient rental property isn’t really that big of an undertaking. You can tick several “green home” boxes simply by making a few key replacements. The financial and goodwill returns might not arrive instantly, but they are sure to come and will accumulate over time.
Ways to Make an Energy Efficient Rental Property
Use a Smart Thermostat – smart thermostats can cost somewhere north of $200, but they are a great investment. A properly installed smart themostat can reduce the energy usage of a home by as much as 10% for heating and 15% for cooling. Considering that half of the energy usage of an average American home comes from heating and cooling, the savings from a smart thermostat can easily accumulate and pay for itself in as little as 18 months or so.
Fix Leaky Windows – many properties have a lot of energy leaks due to improperly maintained windows, with unsealed cracks or improperly aligned hinges resulting in heating and cooling appliances in the house working harder. Simply fixing the air leaks in these cases can do wonders. And you don’t even need to go with a full repair. Silicone caulking or weather stripping around the frames can fix the leaks for a fraction of the price.
Use Fiberglass Attic Insulation – it’s difficult to pitch this one, because it seems like an expensive endeavor, but bear with us. It comes with a hefty ROI. According to an ROI report by Remodeling Magazine, a fiberglass attic insulation would cost around $1,343 on average, but it also resulted in the value of the property to increase by as much as $1446. Coupled with the value increase allowing for higher rents, the initial installation of the fiberglass attic insulation becomes much more appealing.
Use Energy Efficient Appliances
Sometimes the biggest electricity hogs in a household are the appliances themselves. Many property owners just buy the cheapest appliance they can see, without considering that cheap appliances are usually not efficient. They all add up, to the point where your property is consuming much much more electricity than it should.
Of course, this suggestion doesn’t sound too appealing if you have a ton of appliances to replace. If this is the case, you should wait until the appliances die or have become too obsolete that they demand replacement, then you should start going for more energy efficient models.
Replace Lights with LED
This is a no-brainer. It is common knowledge that LEDs consume significantly less electricity than their counterparts, while producing the same amount of light. In this case, even if you have fully working incandescent or halogen lights in the property, you should go ahead and replace them all with LEDs. LEDs are slightly more expensive, but they pay for themselves due to the savings and as a bonus, they also have a longer lifespan so your energy efficient rental property won’t need lighting replacement for longer periods of time.
Consider Going Off-Grid
This might be the hardest to recommend, because going off-grid with alternative energy sources like solar or wind is a serious undertaking. You have to consider a couple of things first before you use this for your energy efficient rental property. For starters, initial investment is significant. Installation of solar panels and/or wind turbines is prohibitively expensive; from the panels and turbines themselves, to the inverters, charge controllers, and batteries cost a hefty sum and will require a professional.
Next is that an off-grid system will require maintenance. Unless you have willing renters who are familiar with a solar system, you have to periodically send electricians from time to time to check on the batteries, the wiring, etc to ensure that they are in tip-top shape. Otherwise you run the risk of breakdown or even fire. This brings up another consideration: you have to check with the state because most states require permits before you can set up an off-grid system.
With that being said, if your feasibility study reveals that the above problems are surmountable, then going off-grid is an excellent way of creating an energy efficient rental property. Your tenants will appreciate never having to worry about electricity, and you get to enjoy more of the rent as you don’t need to worry about utility bills.
The above examples are merely tip of the iceberg, there are other ways to go green with your rental property if you are creative enough. But they should be enough to get you started, and to show you that an energy efficient rental property is definitely achievable.