The number one spot for home improvement projects with the highest return on investment is converting to a heat pump! That’s right! New technology now makes heat pumps the most efficient and cost-effective way to handle both heating and cooling for your home, regardless of where you live. Not only do they outperform traditional systems, but a heat pump will keep your home more comfortable and will operate more quietly than your old system, which makes life at home much more enjoyable. 

Best of all, the annual JLC Remodeling Cost vs Value Report for 2023 reveals that not only is this a popular project, but it also offers an exceptionally high return on investment, a whopping 104% for homes in the Mountain Region (including New Mexico).

Sooner or later every home will require replacement of its heating and cooling equipment (also known as HVAC). The life expectancy for this equipment is 15 to 20 years. If your existing HVAC equipment is approaching the end of its useful life, now is the time to start your replacement project. 

There are many heat pump options to consider, and there are various conditions in your home that will indicate which one is the right choice for you. Check out our Step-by-Step Plan for Replacing an Old A/C and Furnace with a New Technology Heat Pump, with information on what you need to know beforehand, how to choose the right contractor, and get the best equipment for your home. If your HVAC system is still in its prime, this plan includes action steps you can take now to make your home more energy efficient. Wasting energy is like burning dollar bills in your fireplace! Start saving today!

2. Give your home a “Cool Roof”

Next up on the home improvement list is adding a highly reflective cool roof coating or cool roof shingles that deflect heat away from your home and into the sky instead of transferring it to the inside of your home. If your home has a flat or low slope rolled surface, adding a reflective cool roof coating over your existing roof is a relatively simple and cost-effective project. If you have a pitched, shingle roof, it can be more costly to replace existing shingles with cool roof shingles. Check with a roofing professional for cool roof options for your home.

There are many benefits of reflective cool roofs including:

• Reducing your energy bills by keeping heat away from the interior of your house with an average savings of 7% to 15% of total cooling costs.

• Extending the lifespan of your air conditioning system by alleviating the strain caused by having to have your A/C constantly running.

• Improving temperature comfort levels for indoor spaces that are not climate-controlled, such as garages, covered decks, and patios.

• Extending the lifespan of your roof by lowering its overall temperature and reducing the stress on its surface. 

• Helping to prevent local power outages in local power by reducing the demand put on the power grid, especially during the hottest part of the day.

It is important to have any cool roof option professionally installed. Most manufacturers will not warranty their cool roof products unless applied by someone trained and certified to do so. Before selecting a roofer, be sure to check references and make sure the roofer’s license is in good standing.

If you already have a cool roof coating on your roof, it is important to keep it maintained. A well-maintained cool roof system will keep your roof in tip-top condition, saving you money on energy bills and avoiding costly roof repair bills in the future.

3. New Energy Efficient Appliances

Kitchen upgrades are popular, but they usually only realize up to a 70% return on investment in added resale value.  However, you can significantly increase the value of your home by replacing older appliances with the most energy-efficient ones available.  

The typical household spends $2,200 per year on energy bills, and energy-efficient appliances can seriously reduce your monthly costs. Saving money is an added bonus while you are enjoying your new kitchen! And at resale time,  those energy savings will be a major selling point for your property. According to Consumer Reports, making the right appliance choices in your kitchen remodel can add between 3 and 7% in resale value.

Even if you only replace one appliance at a time, you will still realize savings on your energy bills. If you shop around ahead of time, you’ll be ready to replace each appliance at the right time with the most energy-efficient models available and see your savings mount up.

4. Smart Home Features

Another way to update your home and add to its value is to make your home “smart”.  Smart features include automated lighting, appliances, thermostats, and even irrigation monitoring systems that water only when needed. Automated Smart features make a home more comfortable by regulating the temperatures more evenly, and save money by managing and minimizing energy consumption. 

Home buyers love smart and automated features, and real estate professionals know that homes with smart technology sell faster and for more money. Appraisers make “adjustments” to add value to tech-enabled homes as compared with similar but tech-deficient homes. 

Keep in mind that while smart home technology can add to the value of your home, it is important not to over-improve the home being upgraded. Extensive home automation in a starter home located in an inexpensive area may be something a potential buyer likes but might not be able to afford. To realize maximum value, all home improvements should be kept in sync with what your home and neighborhood can support.

5. Solar energy for your home

Solar panels are a great way to reduce or even eliminate your electricity bill while also benefiting the environment. But did you know another primary benefit of installing solar panels on your property is their ability to increase the home’s overall value? 

A recent study by Zillow found that homes with solar panels sold for an average of approximately 4% more than similar homes without them.  The added value of a solar energy system is determined by its size and the amount of energy it is designed to produce along with the actual value of the generated electricity. 

Solar panels provide electricity to your home. The savings from not having to pay the utility company for electricity are easily calculated. Buyers are eager to buy homes powered by solar energy, and appraisers have no trouble adding value to solar-powered homes as long as they have access to information regarding how much electricity is produced by the system.

If you are thinking about adding solar to your home, there are a few things to consider. First, be careful to choose a well-established, reputable solar installation company with a good track record. Solar only adds value if you have a well-designed, efficient system that meets all utility company requirements and produces the amount of electricity it was designed to produce. Unfortunately, the popularity of solar has attracted some “bad actors” into the solar business who don’t have your best interests in mind. 

There are substantial Federal and State incentives for solar panels, home storage batteries, and installation. Good solar contractors will provide information on these incentives and how to access them.