Show Me the Payback on Energy Efficient Homes

Almost 40% of new homes constructed in 2016 had a HERS rating; according to RESNET, that totaled a record breaking 206,583 homes. HERS ratings and ERI scores are gaining popularity with consumers, and rightfully so. When purchasing a car, consumers consider such factors as their MPG (miles per gallon) stickers, reviews online, and more to know the value they are getting for their investment. A HERS rating, or home energy efficiency rating, helps determine the value of your investment in a home.

 So, what about existing homes?

Showing a consumer how to update their home to the comfort level and indoor air quality of a modern home is the easier part. A qualified Building Analyst or Energy Rater can demonstrate the performance of a home, but how can you also show them it makes financial sense?

Proving the Value

If you haven’t already heard, Remodeling Magazine and the Journal of Light Construction has released their “Cost vs Value 2017” study. This study evaluates 29 different remodeling projects in 99 markets around the US, and calculates how these projects impact the value of a home at resale. What makes this important for insulators? We’ll give you a hint, remodeling your kitchen and/or bathroom was not the big winner this year.

No, no, no. The big winner for 2017 is insulation!

It’s okay if you looked back and read that last statement twice. It came as an exciting surprise for us all: Number one in the 2017 analysis is attic insulation. It even came with a return on investment of 107.7%.

In fact, adding insulation was the only project with a return in triple digits.

The Takeaway on HERS Rated Homes

An energy efficient home benefits both a consumer’s quality of life and their pocketbook. While there are many things you or your sales team can “tell” a consumer, there is nothing better than being able to back it up with facts from a credible third party. The record breaking amount of HERS rated homes in 2016 is proof that energy efficiency is, and will continue to be a major selling point for homebuilders. Several studies in recent years have shown that green homes sell faster and bring higher prices per square foot. So, the next time your customer asks about payback, this remodeling study should act as one more resource to help you close the deal.

By Ken Allison

Ken Allison works for IDI Distributors as a Business Development and Building Science Expert. Learn more about energy efficient insulation and tips for closing the sale when you attend one of our regional training events for applicators and contractors. Click Here to find one near you >


Have a question on anything insulation, pricing, or want to place an order? With hundreds of products and countless services, our experts will help walk you through the process of getting ready for your next project. Get in contact with our team today for help and guidance on the right products and best techniques for you and your business.