Living Green Olympia: Will Your Power Bills Scare Off the Buyers??

Will Your Power Bills Scare Off the Buyers??

When buyers evaluate homes they might want to buy, one thing that often comes up is the energy efficiency (or lack thereof) of a particular home.  A savvy buyer wants to make sure they know the full cost of owning the home they choose, and even if the purchase price is affordable, there is more to be considered. 

Will the winter heat bills all of a sudden blow up their budget?  Is the house well insulated or are they going to be feeling drafts the moment summer is over?  Is the furnace old and inefficient?

 

Scared buyer

Yes, the smart buyers do ask these questions.  A common request from a really serious buyer is to review the recent power bills for the last year.  Certainly each family has a unique lifestyle so that if the current owners of the house are a family of five, with three teenage girls, and the elderly mother of one spouse, their power bill may be higher than the single person considering buying.

But if you already hate your power bills at the house you are selling, it may be well worth the time to investigate if there are easy ways to improve things - for you and your potential buyers.  You may want to start with scheduling an energy evaluation to see where you could make improvements that make sense for the length of time you intend to own the house (ie some improvements are pretty costly on the front end and you might need to stay in the house for years to see the payback equal out).  But adding some insulation, sealing up areas around doors and windows, installing a programmable thermostat, getting your furnace serviced for top efficiency - these may be very low cost/high benefit kinds of things to consider.

Your buyers will be much less nervous if your power bills are not through the roof - and you will enjoy the savings until you do sell!

 

                                                                           

  ***********************************************************************************                              

                        Showing Olympia - Let me show it to you!!

For Info on the Communities of Olympia, Lacey & Tumwater  WA and the real estate to be found here, just call me, text me, email me!  And I'd love for you to subscribe to my blog.

Nancy Conner, City Realty Inc,    360-701-1086     nancy@cityrealtyinc.net      

Comment balloon 47 commentsNancy Conner • January 23 2014 10:38AM

Comments

In my area it is the water bills that are crazy. Some cities have nutty rates even when you don't hardly use water. Power bills vary widely too Nancy depending on who you pick for your provider which we have deregulation. Very good point, always check this out along with property taxes. The "other" goodies that can make your home purchase a nightmare, AND HOA fees too.

Posted by Gary Woltal, Assoc. Broker Realtor SFR Dallas Ft. Worth (Keller Williams Realty) almost 5 years ago

Buyer's always seem to ask me about the power bill... Nancy.  Fortunately, our utility companies will provide a 1-2 year average with high/low months.  It's great information, but also subjective based upon personal usage (i.e. some like it hot/cold).

Posted by Melinda (Mel) Peterson, Curator of Happy Endings (Real Estate Cafe LLC) almost 5 years ago
Gary, it's so true that all kinds of utility rates can vary dramatically from location to location. In the Olympia area, there are homes on city water, others on privately managed community systems & still others on individual or shared wells. Bottom line is that I always like buyers to know ALL the regular costs they'll have to live in a particular house so they don't have a bad surprise to the budget! And sellers who help provide that info are much appreciated.
Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago
Mel, it does seem like power bills are the most frequent request here too. We used to be able to get an average power cost for a particular address, but now the power company will only provide that to the seller. Although, you're right that usage can vary dramatically! So it's only a piece of information, but not a guarantee that the next buyer will have the very same bills.
Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago

Yes Nancy, it's just another monthly expenditure that needs to be taken into consider.  Utility usage is subjective.  An owner could be good at conserving and the new owners aren't.  

Posted by Carla Muss-Jacobs, RETIRED (RETIRED / State License is Inactive) almost 5 years ago
True Carla! A seller's bills only give a buyer a bit of information....but their own bills could vary quite a bit. I've seen low power bills be very reassuring though to first time home buyers who are really budget conscious. So it's a starting place at least.
Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago

I used to live in older Oklahoma City neighborhoods in homes built between 1910 and 1937. When natural gas prices were high it was not unusual for me to pay up to $400 a month in winter gas bills. This in  no way stopped people wanting those inefficiently built older homes of character. It did stop me however, and I later built a new home where I cut those bills by 75%. It is important to inform prospective buyers as to what they want and are willing to pay for. They make the decision based on good information.

Posted by Joe Pryor, REALTOR® - Oklahoma Investment Properties (The Virtual Real Estate Team) almost 5 years ago

I divide the annual average by the number of people who live there, then multiply by the number of people in the buyer's family. From there, I try to find out what energy efficient improvements could be done. I always encourage my buyers to consider it as part of the decision but not to be a deal breaker.

Posted by Tina Parker, CNE, REDM, SRES, CSP Home Staging REALTOR, Halifax (Royal LePage Atlantic) almost 5 years ago

Nancy, and unless they are willing to look at new construction, they may not have much choice--especially if they are very specific as to the area they want to live.  I know people that bought a new home with very good energy bills but now pay considerable for the extra commute :)

Posted by Charles Buell, Seattle Home Inspector (Charles Buell Inspections Inc.) almost 5 years ago

I have had solar panels on my roof since 1983.  Saves a lot of money on hot water. I also use a programmable thermostat and added more insulation.  All incandescent light bulbs were replaced with CFL bulbs.  Water saver bath fixtures.  Energy saver appliances.

Posted by Jerry Lucas, Mobile Notary Colorado Springs, CO Notary Training (ABC Legal Docs LLC) almost 5 years ago
You nailed it Joe - for you the "old house charm" wasn't as attractive as more affordable power bills. And at least if a buyer chooses differently, it's good if it's an informed decision.
Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago
Tina, I agree that it doesn't have to be a deal killer if the house in question has inefficencies that the buyer can correct or improve (and can afford those improvements or negotiate accordingly).
Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago
Charles, there are always those darn tradeoffs aren't there? And each buyer will weigh out pros & cons, costs & benefits very differently.
Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago
Hi Jerry! Sounds like you've been able to incorporate quite a few things that have likely resulted in some noticeable savings. Nice!
Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago

Commented a few minutes ago but I guess the system didn't like my response. My electric bill went from $150 to $210 last month. Weather has been extremely cold here for Florida. Same everywhere this year I think.

 

Posted by Bill Reddington, Destin Florida Real Estate (Re/max Southern Realty) almost 5 years ago

I never thought of it but the power bills can indicate outdated electric as well!

Posted by Gary L. Waters Broker Associate, Bucci Realty, Fifteen Years Experience in Brevard County (Bucci Realty, Inc.) almost 5 years ago

Heating with electricity can depend a lot on the utility. Ours is community owned and lower the rate last January, again in April. But as for everyday usage, unless it's an old mobile home with aluminum wiring, depends on the family size, useage habbits. I was brought up on a Maine farm, taught to hang clothes out instead of thrown in the dryer. We did full loads of laundry, not just Suzie's jeans only for the big dance tonight just a few hours away and the house in an uproar over it. What were you taught growing up? Pass those lessons on to your kids.

Posted by Andrew Mooers | 207.532.6573, Northern Maine Real Estate-Aroostook County Broker (MOOERS REALTY) almost 5 years ago

It doesn't happen often, but sometimes a high utility bill can thwart a buyer from purchasing a particular home.  I remember back several years, when California was in the midst of an energy crisis.  One particular home had an electric bill that approached $400.00 for a month in summer.  It was a deal killer!

Posted by Myrl Jeffcoat, Greater Sacramento Real Estate Agent (GreatWest Realty) almost 5 years ago

Buyers do ask what the utility bills might be, and even though electricity or heat is dependent on the homeowners style, it's still useful information to have.

Posted by Kat Palmiotti, The House Kat (Grand Lux Realty, Monroe NY, 914-419-0270, kat@thehousekat.com) almost 5 years ago
Hi Bill - maybe the system didn't like the idea of that high a power bill....in Florida! I bet you didn't like it much either!
Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago
Gary, that could be the case. Really high power bills may at least prompt the buyer to investigate a little further into the reasons.
Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago
Andrew - am laughing about your comment with the example of drying just Suzie's jeans! Pretty sure when I was growing up, my mom would have seized the opportunity to have a little talk with me about planning ahead! And then I would have been finding something else to wear.....
Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago
Hi Myrl! I've also seen buyers get REALLY concerned if a utility bill is going to eat up big chunks of their monthly budget. And there's always that learning curve of what "average" bills might look like in a new part of the country. Here, power bills are typically at their lowest in the summer since we rarely need air conditioning - and many homes don't even have it. Usually less electricity usage too in the summer with many more hours of daylight & more barbecuing outside instead of indoor cooking.
Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago
Hi Kat! Buyers do like to know, or sometimes have been advised to ask. I usually prepare sellers for that request, along with any info that might explain higher than normal amounts (like a new baby in the household creating about triple the usual number of loads of laundry!)
Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago

Yes-- they can and will scare a savy buyer away. Good read, thanks for sharing..

Posted by Robert Hicks (United Country River City Realty) almost 5 years ago

Right now, with Propane prices soaring all over the country, I'm enountering buyers who want an all-electric home.  Five bucks per gallon for propane is scaring those buyers away from some listings.

Posted by Eric Kodner, CRS, Madeline Island Realty, LaPointe, WI 54850 - (Madeline Island Realty) almost 5 years ago

There are a lot of variables which one must consider when looking at the seller's energy bills.. It depends on the whether or not people occupy the home during the day, or is everyone at work... what is the temp during the day - during the evening.  Are there older/younger folks in the home for whom the temps are kept higher/  etc.  each situation is unique.

Posted by Joan Whitebook, Consumer Focused Real Estate Services (BHG The Masiello Group) almost 5 years ago

I agree with Joan #27. Everyone's energy usage is different.  And, I don't think it is a bad idea to get an energy evaluation. Simple furnace or a/c maintenance can ensure these appliances are being used to their efficient potential. Thanks for the blog!

Posted by Rosie Moore (Serving Sugar Land, Richmond, Rosenberg, Missouri City) almost 5 years ago

I think it mean quite a bit these days. Energy costs are a bit up! :)

 

Love and light,

Laura

Posted by Laura Cerrano, Certified Feng Shui Expert, Speaker & Researcher (Feng Shui Manhattan Long Island) almost 5 years ago

Nancy, I fully agree with you. As much as it all depends on the habits and requirements, this is something that should be a concern for buyers!

We have 'MASS SAVE' program that does a thorough check on how one can save energy.

Posted by Praful Thakkar, Andover, MA: Andover Luxury Homes For Sale (LAER Realty Partners) almost 5 years ago

 

I'd also suggest those buyers who move from a condo to a house research more about utilities costs( not to have any surprises in future). I remember, when I moved to a house, my first bill for electricity/water/trash was a huge shock.

Energy efficient appliances and a proper home isolation is the must to keep some utilities payments low.

Posted by Inna Ivchenko, Realtor® • Green • GRI • HAFA • PSC Calabasas CA (Barcode Properties) almost 5 years ago

Energy useage is very personal; different families have different sensitivities to how much they use. That being said, locally homeowners can get a free energy audit and use those results to help sell their homes.

Posted by Nina Hollander, Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor (Coldwell Banker Residential Brokerage | Charlotte, NC) almost 5 years ago

Good mornng Nancy. Great topic and accurate. In my experience both personally and professionally, heating and cooling costs do matter: a lot.

Posted by Sheila Anderson, The Real Estate Whisperer Who Listens 732-715-1133 (Referral Group Incorporated) almost 5 years ago

Nancy, I think buyers do want to know what their utility expenses will run when purchasing a home. Although different life styles will dictate how much is used, it will still give the purchaser an idea of the costs.

Posted by Michael Setunsky, Your Commercial Real Estate Link to Northern VA almost 5 years ago

Around my home, we just bundle up when it gets cold but not everyone takes that approach...Definitely a factor but can be handled

Posted by Richie Alan Naggar, agent & author (people first...then business Ran Right Realty ) almost 5 years ago

I perform Home Inspections and Energy Audits here in Reno andit is very rare for people to ask for utility info. While it's a great idea it's true that occupants do have an impact on this. If your touring a house look for some signs that might give you a clue to how the house performs. Electric heaters, plastic on windows lots or wood or pellets stored up, and old heating or cooling systems. I know FHA loans are not as desireable as they once were but doing an Energy Efficient Mortgage is a great option for those older houses. 

Posted by Rob Ernst, Reno, NV-775-410-4286 Inspector & Energy Auditor (Certified Structure Inspector) almost 5 years ago

Nancy:  Ironic .. my brother-in-law just told us that he is planning on having the utility companies come to perform an energy audit next week.  Truly makes sense for a whole host of reasons ...

Gene

Posted by Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi, 708.921.6331 - 40+ yrs experience (NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656) almost 5 years ago

Buyers want to see these costs. It can make or break a sale.

Posted by Debbie Reynolds, Your Dedicated Clarksville TN Real Estate Agent (Platinum Properties) almost 5 years ago

Great point, Nancy. Energy efficiency is bigger on the radar than it used to be, especially in urban areas with high energy costs. On the flip side, energy-efficient improvements can be a great selling point. One of my co-workers lives in a historic Nashville neighborhood; when he and his wife sold their first house there a few years ago, the buyers told their agent they were really drawn by the new windows and HVAC system.

Posted by Jim Griffin (HouseLens: Video Marketing for Real Estate) almost 5 years ago

Thanks Robert - many, many buyers do like to make sure the whole package of costs fits into their budget without too much pinching.

That's interesting Eric!  Here most houses have either electric or gas heat (owned by the same company...) but in some of the rural areas where natural gas is not available we do see propane.

Joan, there are indeed a lot of variables that can impact energy costs, so any info on seller's bills is only one bit of info for the buyers to weigh.

Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago

Thanks Rosie - energy evaluations are a great tool to make sure that costs aren't higher than they need to be.  And regular "tune-ups" for heat systems can also sure help make sure maximum efficiency is reached.

Hi Laura - with so much of the country having a REALLY cold winter, I suspect energy bills are on many people's minds.  We've been lucky to (so far) have a pretty mild winter here.

Your Mass Save program sounds like a great one Praful!  Our power company is also pretty proactive at encouraging people to improve energy efficiency with rebates and special offers.  Always great to get some help lowering those bills!

Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago

Good point Inna!  I can remember buyers moving from either a condo or a rental where utilities were either included in the HOA fee or paid by the landlord - that sure can be a shock to realize it's a new expense to budget for!

True Nina - as we are seeing more people here get the energy audits, it is and likely will continue to be something sellers can show as a plus (if they do have an energy efficient home)

Hi Sheila - thanks!  I agree that I sure do scrutinize my utility costs and try to figure if there are ways to lower them!

Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago

Yes, Michael - it does at least give them a starting point to consider if maybe they will want to/need to do some energy efficiency upgrades in the home - or maybe decide it just is not the right home for them at all!

Love it Richie!  Brings back memories of my mom telling my siblings and I to just go put on another layer if we were saying we were cold!

Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago

Rob, you bring up an excellent point that sometimes there are some little hints to help a buyer!  Since we don't typically have super hot summers here, when I show a house that has window air conditioners in several rooms, I always wonder.... And we have at least one local lender who will incorporate the cost savings of adding energy efficiency in how they consider the debt to income ratio of a buyer.

Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago

Hi Gene!  Well, if he lives back there in "deep freeze country", it sure does make sense to let an energy audit point to any ways to cut costs and gain comfort!

Debbie - and it really can go either way.  Buyers can be really reassured to find out their utility bills won't be too awful - and in comparing similar homes, it can be a deciding factor.

Exactly Jim!  A wise seller can really position their home to stand out (in a positive sense) if they can detail energy improvements they have made!

Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago

Another useful energy saving tip I forgot, an electric blanket.  A programmable thermostat lowers the room temperature overnight, but an electric blanket keeps you warm while sleeping.  Then the programmable thermostat raises the room temperature again before the morning alarm clock goes off.

Posted by Jerry Lucas, Mobile Notary Colorado Springs, CO Notary Training (ABC Legal Docs LLC) almost 5 years ago

Great tip Jerry - there are so many good ideas like those to keep people comfortable without costing them a fortune in power bills!

Posted by Nancy Conner, Olympia/Thurston County WA almost 5 years ago

Participate