As a property owner, you're no doubt aware that energy bills can be a huge ongoing expense, and so it pays to take steps to make your home more energy efficient. Similarly, if you own a rental property or even a building with multiple tenants, improving its energy efficiency could make a lot of sense. Many landlords cover their tenants' electricity costs and pay for heat, so reducing those expenses could result in a lot of savings over time. But the first step in making your property more energy efficient could be none other than an energy audit.
What is an energy audit?
An energy audit is a comprehensive assessment of how energy efficient or not your property is. During an energy audit, you can expect a professional to come in and evaluate:
- Your appliances.
- Your heating and cooling system.
- Your water heater.
- Your insulation and ductwork.
- Your indoor air quality.
- Your windows and doors.
- Your lighting.
From there, your energy auditor will be able to make suggestions on how to lower your heating and cooling costs. These could include:
- Upgrading older appliances.
- Adding insulation.
- Replacing an inefficient air conditioning or heating system.
- Getting new windows or better sealing your current windows.
- Replacing your light bulbs with energy-efficient LEDs.
How much does an energy audit cost?
The amount you'll spend on an energy audit will depend on the size of your space. HomeAdvisor (NASDAQ: ANGI) reports that an energy audit generally costs between $100 and $1,650, with an average cost of $409. Keep in mind that if you're having an audit done on a larger property or a multi-unit building, you can expect your costs to be substantially higher.
What about savings?
An energy audit can result in up to a 30% reduction in your annual energy consumption. In other words, you might shave 30% off of your heating and cooling costs. If you're a landlord who pays these bills for a multi-unit building, that could translate into a lot of savings, and even average homeowners can reap some savings over time.
But one thing you should know is that to enjoy those savings, you'll need to actually make the changes your energy auditor recommends. And those changes could be costly.
While LED light bulbs, for example, are fairly inexpensive, costing less than $10 apiece, you're going to spend a lot more money to update applications, ductwork, and heating and cooling systems. In fact, HomeAdvisor reports that a single energy-efficient window could cost anywhere between $120 and $1,200. Even if you manage to get away with the lower end of that range, replacing all of your windows could be quite the outlay, and it could take a really long time to recoup that investment based on energy savings.
Of course, in some cases, making energy-efficient improvements could make your home a more pleasant place to live. Upgrading your windows, for example, could help keep your house cool in the summer and warm in the winter, so there's a quality of life factor to consider as well.
Should you get an energy audit?
An energy audit could reveal some relatively easy, low-cost ideas to improve your energy efficiency and lower your utility costs, and given the relatively low price tag for an average-sized home, it may be worthwhile. But if you're going to have an energy audit performed, be prepared to either ignore some of the advice you're given or shell out a lot of money to follow through on it.
Get the 'Dirt on the real estate market
Are you looking for the next hot real estate market? Want to know how new rules and regulations could impact your next home purchase or real estate investment? Would you like to find out which improvements to your property will get you the most bang for your buck? We cover all these things and more in our newsletter, Paydirt.
Sign up here to get our best insights delivered to you.