- The Washington Times - Thursday, February 16, 2006

When preparing a house for sale, most homeowners focus on the cosmetics — sprucing up the exterior, kitchen and bathrooms. But what about the less obvious, such as the insulation in the home? Are the appliances energy efficient? Has the heating and cooling system in the home been properly maintained?

Savvy sellers and real estate agents realize they need to factor energy efficiency in a home sale.

Buyers want to consider the cost of energy bills they’ll be paying once they move in, especially with older homes that don’t have the advantage of the latest technology.

Some industry insiders say that, faced with soaring fuel prices, buyers and agents are doing their homework and asking about upgrades that need to be made for improved energy consumption.

“Realtors will find that the house with the high energy bills is the house they have a hard time selling,” says Doris Ikle, founder and president of CMC Energy Services Inc., based in Bethesda.

In 2002, CMC launched Home Energy Tune-up, a program that provides homeowners with a professional inspection and inventory of all energy-using systems in the home.

The report, which costs less than a standard home inspection, provides details on any items that need to be replaced to control energy costs and on how to make those improvements.

“It tells them the changes they can make to lead to a more valuable, comfortable home,” Mrs. Ikle says.

Homeowners who take action on the recommendations can expect an average savings of 25 percent on energy bills and can reap the benefits of their investment when it comes to resale time. Mrs. Ikle says sellers will get back every dollar spent on replacing or upgrading existing appliances and systems, if not more.

Real estate agents have been expressing more interest in Home Energy Tune-ups — some even purchase them as gifts for buyers after they move in, instead of the more traditional home warranties.

“When the prices of gas went up, they woke up,” Mrs. Ikle says. She says that as long as buyers insist on knowing the energy-related facts, agents will need to provide quick answers.

In addition to increasing the value of a home and slashing monthly bills, homeowners this year can get tax breaks for specific energy upgrades. They can qualify for a tax credit equal to 10 percent of the money spent on the installation of certain improvements and can also take a credit for “qualified energy property,” including items such as circulating fans or heat pumps, says Andrew Schwartz of Boston, a certified public accountant with RealEstateProTaxes.com, a network of CPAs specializing in real estate.

While many in the industry agree that, whatever the motivation, homeowners are becoming more interested in energy expenditures in the home, some aren’t convinced that rising energy bills will drive buyers away.

Realtor Michael Zuro with Long & Foster in Bethesda says he notices buyers are more aware of the difference that the energy performance of a home can make to their overall budget.

But “whether they are actually looking at a label to see how energy-efficient something is, and whether that’s a deal-breaker or not, is another story. I’m not sure,” Mr. Zuro says.

Tim Horinko, Realtor with Keller Williams Fairfax Gateway in Fairfax, points out that the latest energy technology can be a perk when putting your house on the market. But he says sellers can’t expect to get every penny returned — especially for the pricier new options, such as tankless water heaters.

He says the most visible items, such as energy-efficient windows, would have the greatest impact as a selling feature.

“It would enhance the salability, and they would get the majority of their money back, especially in a down market,” Mr. Horinko says.

Others say buyers only ask energy-related questions if a house needs obvious renovations.

Donald Denton, a Realtor with Coldwell Banker in the District, says energy efficiency is not at the top of his buyers’ priority lists.

He says that, in the current market, buyers who are spending $800,000 to $900,000 on a house aren’t that concerned with utility bills.

“Unless it’s a rare day, and it’s freezing, and the wind is blowing through the house, and the door frames are not properly sealed — they aren’t going to stumble over that,” Mr. Denton says.

Harry Misuriello, director of buildings and utility programs with the Alliance to Save Energy in the District, recommends a number of energy improvement projects homeowners can initiate to get the biggest bang for their buck.

“Replacing highly inefficient furnaces and air conditioning units should be at the top of the list,” he says.

He says the costs of updated, more effective models are reasonable and a long-term investment that will pay off.

The next top consideration for homeowners hoping to lower energy bills is ensuring that any renovations in the home incorporate Energy Star appliances.

“That’s the frosting on the cake — the buyers walk in and see the new kitchen, but they also see that it’s energy efficient,” Mr. Misuriello says.

Lighting is also an important component, so use compact fluorescent bulbs for the vanity lights in the bathrooms and for other fixtures. Recent advances in lighting design allow for efficient use of windows, to help reduce the need for artificial lighting during the day.

Insulation in the home is also a key component to ensuring that you keep the heat in your home and more money in your pocket. Heat loss through the ceiling and walls in the home could be significant if the insulation levels are less than the recommended minimum.

“Insulation should always be added to the home,” Mr. Misuriello says. Insulate the attic, exterior walls, basement and crawl spaces.

If you don’t have the funds for equipment upgrades right now, you still can save with low-cost, simple home energy improvements — caulking between window and door frames and walls, adding or replacing weather stripping for windows and doors, and insulating the water heater.

On the other hand, for homeowners who can afford the latest in energy technology, many options are available, such as tankless or “instant” water heaters, pellet stoves and solar energy collectors.

GridPoint Inc. (www.gridpoint.com), based in the District, sells Intelligent Energy Management, a system that uses renewable energy and provides emergency backup power.

The appliances start at $5,000 and are based on battery technology that allow the homeowner to buy energy at the lowest price, sell the excess back to the grid, and cut their overall energy bill by 15 percent to 25 percent.

One of the major benefits of the technology is that GridPoint users can view a personalized graph and easily track their energy usage. They can see a breakdown of the costs.

“It gives you a line-item reading, which is a very useful way to see what you doing, the environmental benefits, and how much money you have saved,” says GridPoint CEO Peter Corsell.

Mr. Corsell says sellers can anticipate significant return on an investment like Power Grid because they can clearly demonstrate that their house has lower energy bills.

“There is a real value there — there is something concrete and measurable about it,” he says.

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