How To Add Home Equity Through HVAC Upgrades
Americans are spending increasingly large amounts of money on residential remodeling projects each year and seeing less and less of a return according to Harvardâs Joint Center for Housing Studies. From 2017 to 2018 money spent nationwide increased 7.5% which is equivalent to $340 billion. The average return on investment only being 56% which is a 12% decrease in one year according to a survey by Remodeling Magazine. When planning a renovation in preparation to sell it is key to maximize your ROI. Knowing which upgrades will add the most value is important. HVAC upgrades are typically overlooked by homeowners, but they are always a safe bet and smart investment.
Why to invest in your homeâs HVAC system:
Updating your HVAC system is critical because homebuyers wonât notice a brand-new system, but they will definitely notice a broken one. Sure it would be nice to show off new kitchen cupboards or new flooring, but if you donât make your HVAC system a priority you wonât achieve much of a ROI because people may overlook old flooring, but they wonât look twice at a home with an old or broken HVAC system. The National Association of Realtors reports that HVAC remodels have a higher average ROI yielding a return of 71%.
Questions to Consider When Updating your HVAC System
You should always think about the region, the age, size of your home, your budget, and layout of your property.
Is your current HVAC system still working well?
Is your system less than 10 years old? If the components are still operating optimally, there is no use paying to fix what isnât broken. However, if your system is older than 15 years it will turn off buyers because parts to fix the system become expensive or hard to find. You should consider replacing the system.
Can you get away with an HVAC repair rather than a replacement?
If the system is less than 10 years old, but functions like it needs to be upgraded, you might get away with a few repairs instead of a new system. To find out if you should repair or replace multiply the age of the system by the cost of repair if it is more than $5,000 you are better off replacing than repairing it.
Do you currently have energy-efficient HVAC units?
An increase in preference and popularity among homebuyers is energy-efficient HVAC systems because who doesnât want to save money on utility bills. They stand out in todays housing market. Upgrading to energy-efficient HVAC systems is one of the smartest moves you can make. They have a 5% to 8% higher selling value.
Opportunities for HVAC Upgrades
Hard to go wrong if your home is 20 years old.
Some basic upgrade options are changing out the furnace or boiler system. Your furnace can last up to 15 years with proper maintenance. Changing out those old air ducts. They are made to last up to 25 years however, they start to degrade after 15 years. People want to be comfortable so changing out the air conditioner is a smart investment they can cost anywhere from $4000 to $15,000, but it can increase the value of your home by 10%.
Some luxury HVAC renovation options that attract homebuyers are smart thermostat systems, whole house dehumidifiers, whole house humidifiers, and generators.
Sources:
https://www.jchs.harvard.edu/blog/home-remodeling-expected-to-remain-strong-and-steady-into-2019/
https://www.remodeling.hw.net/benchmarks/cost-vs-value/key-trends-in-the-2018-cost-vs-value-report_o
https://www.nar.realtor/remodeling











