It may seem obvious that your Des Peres, MO home’s HVAC system would influence your property’s resale value. However, you’ll find plenty of conflicting information online on the subject. Some claim that installing a new HVAC system has virtually no impact on your home’s value. Others promise pie-in-the-sky returns that defy logic. Here’s a roundup of the available data to clarify the relationship between HVAC systems and home values.
The Risks of Selling a Home With an Old HVAC
Before diving into how a new HVAC installation affects home values, it’s worth discussing the alternative. If you try to sell your home with an aging HVAC system, you should know some things. One is that any HVAC over 10 years old will receive extra scrutiny from a home inspector. So, it’s a good idea to disclose your HVAC age and condition in your home’s initial listing. It would also help if you could provide detailed maintenance records for your HVAC. If you’ve taken good care of the system with regular HVAC maintenance, it could assuage the fears of a potential buyer.
However, simply having an old HVAC might dissuade some prospective buyers from making offers on your home. That can be especially true if other comparable available properties have newer HVAC systems. All other things being equal, your home’s old HVAC might doom it to a lengthy stay on the market. If you’re hoping for a quick sale, installing a new furnace and air conditioner might be prudent, regardless of cost.
You should also be aware that an old HVAC system might lead to a potential buyer asking for concessions in a sale. There are generally two ways buyers request HVAC-related concessions. They’ll either ask you to replace the system before the sale’s completion or deduct the replacement cost. You may be able to negotiate splitting the cost of installing a new HVAC. However, that could complicate your sale and cause an interested buyer to pass on your property.
The only caveat is if your home has a high-efficiency HVAC system. Such systems retain their value longer than less efficient models. Therefore, a potential buyer might overlook your system’s age because of its projected energy savings.
The ROI of Installing a New HVAC
Most experts claim that you’ll recoup about 30% of the cost of a new HVAC system when you sell your home. However, it’s important to remember the previously mentioned 10-year threshold. The closer you get to that age, the more value you’ll have gotten from your HVAC before selling. That can make a 30% return on investment (ROI) more palatable.
Maximizing the Financial Impact of a New HVAC
You can maximize the positive price impact of a new HVAC in some ways. Here’s how.
Prioritize Quality and Efficiency
If you plan to install a new HVAC before selling your home, you should prioritize two things. First, you should choose a system built by a reputable manufacturer. Keep in mind that potential home buyers will likely not be HVAC experts. However, they will probably recognize common HVAC brand names. By choosing a system from a well-known manufacturer, you’ll reassure potential homebuyers of the system’s quality. A well-built system will also likely come with a more comprehensive warranty, improving its value.
The second thing to prioritize is the efficiency of the HVAC system you install. If you choose a conventional HVAC system, pick one with the highest SEER (Seasonal Energy Efficiency Ratio) and AFUE (Annual Fuel Utilization Efficiency) ratings you can afford. You can even use that information in your home’s listing when the time comes.
Choose an Attractive System Type
Choosing an attractive system type can be an even more effective way to maximize the ROI of a new HVAC system. One excellent option would be to install a heat pump. A study by the Center for Global Sustainability found that installing a heat pump adds between $10,400 and $17,000 in value to a home. The reason is that homebuyers now prioritize energy efficiency and minimal environmental impact. The price premium a heat pump fetches should exceed the average 30% HVAC ROI, depending on installation cost.
If you want a system that will raise your home’s value even more, consider putting in a geothermal HVAC system. Geothermal systems boast a variety of advantages that make them even more attractive to homebuyers. For one, they’re the most efficient type of HVAC system you can buy. For another, they last far longer than most other options. The indoor components of a geothermal HVAC can last for 25 years. The underground refrigerant loops can last up to 50!
So, any homebuyer would know they’ll save a small fortune by purchasing a home with geothermal HVAC. As a result, studies show that homes with such systems sell for an average premium of $28,840 more. Keep in mind, however, that geothermal systems are costly. So, you should only consider installing one if you’re not planning to sell your home for at least a decade. Otherwise, your ROI might be worse than installing a conventional HVAC.
Take Advantage of Incentives
Finally, you can maximize the financial benefit of installing a new HVAC by taking advantage of available incentives. If you choose an especially efficient HVAC system, it will be eligible for various rebates and incentives. Heat pumps, for example, qualify for a tax credit worth up to 30% of their total cost, up to $2,000. By mid-2025, heat pumps will also be eligible for an income-based rebate program. That program will provide point-of-sale rebates of up to $8,000 on qualified heat pump systems.
If you choose a geothermal HVAC, you could save even more. They qualify for the same 30% tax credit as an air source heat pump. The difference is that there’s no maximum cap on the tax credit value. As a result, you can claim the full 30% of your installation costs, no matter what dollar amount it is. You can even carry the tax credit forward over multiple years. That guarantees you won’t lose the credit if it exceeds your single-year tax liability. Some local energy companies also offer rebate programs on geothermal HVAC systems.
Your HVAC Replacement Specialist
If you’re considering an HVAC replacement in Des Peres, count on Level 9 Heating, Cooling, and Plumbing to help. We’ve served local homeowners for 62 years. Our longevity means we understand the economics of HVAC systems in this area in ways other companies can’t. We specialize in various HVAC options, making us the perfect partner for your replacement project. We install quality conventional HVAC systems and heat pumps from leading manufacturers like Carrier.
Plus, we offer geothermal HVAC systems, should you want the most efficient solution. We also provide free estimates so you won’t be blindsided by surprise costs. We can also provide financing options on approved credit to help you pay for a new HVAC solution. Additionally, we’re Better Business Bureau accredited and have an A+ rating.
So, when the time comes for a new HVAC in Des Peres, call Level 9 Heating, Cooling, and Plumbing immediately!