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PhilLenoir wrote: Any real improvement in a house is reflected in its selling price.
IMHO, not an entirely true statement.
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So you're saying you think people would pay the same for a house with leaky, compromised windows than for the same house with new double glazing or one that costs 1500 a year to heat and cool than one that costs 500?
If this is true in your real estate market, I suggest that it's not normal.
Life is like a s**t sandwich; the more bread you have, the less s**t you eat.
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Not the same, but you can't expect your investments to be fully amortised through higher sales prizes! I can tell you from first hand experience, as I'm currently selling my house. As matters are, getting back more than 50% of my investments from the past two years seems highly unlikely. (and that's before fees and taxes, which are raised due to the potentially higher sell price)
At the very least, by asking for a higher sell price you're excluding potential buyers simply because they can't afford it, no matter how much they would be saving in the long run (e. g. due to geothermal heating).
Even for those taking a look, whatever you invested money in may not have been to their liking, or they might have been able to get a better deal for doing the same. Therefore it will not have the same value for them as it has for you.
GOTOs are a bit like wire coat hangers: they tend to breed in the darkness, such that where there once were few, eventually there are many, and the program's architecture collapses beneath them. (Fran Poretto)
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Stefan,
That's not what I stated. the amount you get back depends entirely on the type of "improvement", how long and how well it was done (and other factors). Sometimes an investment is more than recouped. There's a whole slew of TV programmes based on this (the UK's Secret Agent being just one of these). There are some conditions in a property that are so off-putting that they severely depress the value. Most commonly and perversely, these are usually actually trivial in nature and decorative.
On the other hand, some alterations to a house might actually reduce it's value (e.g. doing something that doesn't comply with building codes or really bad decoration).
I used the term "Real Improvement" to mean something like improved insulation, more efficient heating/cooling, repairing an obvious flaw (a leaky roof). I also used the term "reflected". This does not necessarily mean full recovery of residual value. There are many variables involved in a value of property, but any real improvement will increase the value.
How much an alteration affects value would have to be considered taking these many factors into account. Creating a $2M house next to a municipal dump is a poor investment decision. The person wanting a $2M house will not buy there. Having said that it has more value than a leaky half-standing hovel next door; it's just not a good investment choice.
This sub-thread started with the statement along the lines that you should never make an investment with payback of less than a few years. If this were true, nobody would ever put in new windows, re-shingle a roof .... In my view the statement was a silly one. Many (most?) purchase decisions we make have no pay-back, they are simply consumption. In Economics the terms "list of preferences" and "perceived value" are used; these concepts drive our buying decisions, even investment decisions - Blood Diamonds might have been a good investment, but you'd never find me investing in them.
Back to Nagy's original question: Even a 15 year payback is simply looking at energy expense versus installation cost. What if he'd need to install or upgrade the existing heating system anyway? What if there's no air conditioning and he values AC highly. If he sells the property on 10 years time, how much will the improvement affect the expected price. Finally what about his personal perceived value. All these points are valid and make a mockery of the original post that I replied to. Now if your argument is that you plan to, or are likely to, move in 2-3 years then that makes many major improvements questionable from an investment standpoint. There is a bell curve and timescales and local market conditions and projections should guide such decisions. Nagy's a smart guy (at least when he's off the gin [second thoughts - cancel that, I'm not sure he's ever off the gin!]) and I'm sure he'll figure it out.
Life is like a s**t sandwich; the more bread you have, the less s**t you eat.
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I can totally agree with that. I just disagreed with your previous, simplified statement.
re Nagy: he doesn't seem to plan selling his home, and therefore making long-term investments may make sense. Of course, if in a couple of years he finds himself in a situation where he needs to move out, that would be different situation, based on different facts. When this happens, he needs to make a new evaluation and minimize his losses (if any). But it's hard to argue with respect to such a future decision without knowing the reasons, so we may as well advise him based on his current intentions alone. I'm sure he's clever enough to realize that selling his house short term will likely incur financial losses, but that's probably true even without such investments (there are always taxes and fees).
Warning him about potential additional losses in case of a 'premature' sale is fair enough, but I take Nagy's post to focus on the question whether it even pays off if he keeps the house. Of course, we could estimate the cahnces he'll sell the house in x years times as a function of x and calculate an estimated loss due to his investment and not getting full payback via the sale, but there are way too many unknowns to get a reasonable value.
GOTOs are a bit like wire coat hangers: they tend to breed in the darkness, such that where there once were few, eventually there are many, and the program's architecture collapses beneath them. (Fran Poretto)
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If you plan on retiring in that location, than a 15 year payoff might be bearable.
You can probably assume some inflation on energy prices that reduces the payoff window.
As you switch from salary to pension, you're monthly expenses could be quite low.
My uncle has had a system like this for about 20 years and loves it. His system required drilling two well shafts a few hundred feet deep. (vertical pipes vs. horizontal pipes)
On a very hot summer period (multiple daily highs over 100F), It managed to keep the house at 80F during the peak heat, and was able to cool to the target 78F overnight.
The integrated hot water tank was scalding hot during this time.
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A neighbor of mine had a system like that. The only problem came when a developer wanted to build in the area surrounding the neighborhood. My neighbor discovered that the aquifer level beneath his house would have lowered enough after the development that it would have rendered his system useless. Fortunately, this was symptomatic of other water problems with the development, and that helped prevent it.
Software Zen: delete this;
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Ground source loops do not rely on aquifers, Only a system that actually pumps water (open loop) relies on such (they also might use a deep well, pond or river for an open loop.)
Ground source, vertical or horizontal, loops rely on heat transfer to the soil. The presence of water (wet soils) might improve energy transfer, but they probably reduce thermal inertia too, so unless the water is mobile and allows convection, the presence of water might actually be a bad thing. In any case it simply means an adjustment in the size of the loop.
Life is like a s**t sandwich; the more bread you have, the less s**t you eat.
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I have an air-sourced heat pump for about 10 years and it is working fine. You just set the desired temperature and it turns itself on and off to maintain that.
I have heard that if you have a ground source version the ground side loop needs to be away from buildings as it can cause freezing (and therefore expansion) of the soil.
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Ground source heat pump = thousands of currency units, disruptive installation, in most countries negotiating some kind of planning permission etc. etc.
A really good lamb wool sweater = 50 currency units, instant effect.
Just saying!
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I put a solar system[^] on my house. July of this year will be 5 years since it was installed. I would suggest that if you do this, do it less because its a good investment and more because you want to do it.
A few things to consider.
* Even with a 15 year payback, what is the life of the equipment. (will it need to be replaced in 16 years?
* Salespeople are great liars. If they claim it'll do something, take 10% off the claim and see if its still worthwhile. My numbers vs. claim are about 9% less
* Solar panels loose efficiency every year they are on the roof, so they will have much less capacity after 15 years.
Good luck. I'm happy with my system, but I never purchased it as an investment. I consider it tithing to my kid's future health!
Hogan
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That all depends where you are and what the deal is. I know Germany has strong incentives, but I have no idea about Hungary and Nagy is in a better situation to investigate that. Having said that, he was simply asking about ground source heat pumps!
Good for you on the solar. I disagree with you "much less capacity". There are actually 3 different solar PV technologies and degradation does vary between the technologies and the manufacturing quality, but modern panels are typically around 1% residual reduction per year (residual, as opposed to straight line), so 15 years should see a drop of less than 15% (I guess it depends on your definition of "much"!)
For my own system, my 8kW array including microinverters cost about 65k including 13% tax. My wife and I put this through our business, so claimed the tax back. Our income is about 8k pa, so better than 8 year pay back. the panels have an expected minimum life of 25 years, the inverters have 15 year warranties and my contract for supply if 20 years. I may be green, but the "green stuff" really helped make the decision easy!
Life is like a s**t sandwich; the more bread you have, the less s**t you eat.
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I have a closed loop heat pump system. It was expensive. The cost of the drilling for loops was covered by a grant but would have cost 12-13 grand.
The system with out duct work may have cost 6-7 thousand, with duct work 20 grand +. That was with me doing a lot of the work.
Then you need an engineer to size the system for your house. they do a heat loss analysis.
I live in a dome that is super insulated.
The other issue is if the temp is in the near 0 all the time the efficiently drops and makes the system works harder.
I am very happy with the system. It cost me $150 dollars this past February.
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Nagy Vilmos wrote: ground source heat pump
Our pump was replaced recently, even though I'm not that experienced in the area I had some questions.
Nagy Vilmos wrote: . In the summer this can be reversed to cool the house down as well.
I wanted this!!! But it din't happen because of three things:
1. The salesman for the new pump an water boiler said it would lower the temperature by a feew degrees maximum, he didn't think it would be musch use.
2. The need to redo ALL of the pipings and radiators in the house. The pipes needs to be isolated, otherwise you'll get moisture on them and evetually mold. Our house is built 1951 and all the pipings are built into the floor and walls, if they hadn't been built into the floors and walls they could have insulated the pipes running along the walls/floors.
3. The cost would have been SEK 25.000 per radiator (~3000 USD), with a lot of radiators the amount of money was too high.
Nagy Vilmos wrote: As we have a large south facing roof, we should be able to power the whole thing from solar a PV bank.
The exess heat can also be used to heat up the ground during the summer. We have a drilled hole into the bedrock where we get the heat from, but we also live close to the Baltic sea (6-7 kilometers). In our case it means that we have a lot of ground water flowing towards the sea, so if we heat it up we'll only end up putting heat into the baltic sea. If the ground water had been more stagnant we could have been getting the heat back during winter.
In the end we didn't get solar panels, but when we decide to do it everything is prepared for it (it would then only generate heat the water boiler during summer).
Another advice from a friends friend (  ) who sells heating equpment mainly to large corperates was to go for the most basic model without all the bells and whistles.
Control the heating system from your mobile? A big no...
Aside from being a cool feature how are you going to use it? Heat up the house when going from work? Our house is made from stone, no matter how much we crank the heat up it will take a day before we notice it. If it's a vacation home the it might be a good idea though.
The more advanced, the more expensive it will get when replacing/reapiring something.
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15 years is too long of a payback time!
First, the lifespan of physical devices.
Second, the lifespan of the solar panels (efficiency drops, bird droppings).
Here, the average person stays in the house for 7 years. You never get back
what you paid into it. It's worse for an 8yr loss of "payback". You need
the buyer to pay 50% of what it cost to put in, and then you are breaking even.
Living in FL, I looked into solar at a serious level. The sun here is so
strong, that it literally eats the solar panels over time. Now, our roof is a $28,000
roof. Adding a solar panel to it, is much more expensive than "normal", and city codes
get involved. But I checked with others who bought systems with a 10yr payback, and
they said that effectively, the solar panels all needed replacement at or BEFORE 10yrs!
So, lets say the best case is that after 15yrs, you break even? Why bother?
Worse, you have repairs every 5 years = 10% cost. Even worse.
Instead, I did a bunch of research on A/C. I installed a highly programmable thermostat.
I set it up to cool when the sun is not out. We heavily tinted 400 sq feet of glass that
catches a lot of sun. And, during the summer, we close a few hurricane shutters to keep
the sun out. I can say I have the lowest electric bills on the block.
The tinting had a 1yr payback. I have been in the house for 21 years, did this all 18yrs ago.
I am saving $50 to $100/mo (it fluctuates). FPL used to come out monthly to make sure I was
not stealing electricity!
Oh, and I lowered the temperature on my electric water heater. This was a huge savings.
==
Finally, a friend had a solar Hot Water Heater her in FL. The 3rd time the pump for the water
heater died, he had trouble finding other parts, and just got rid of the system. It was the
only thing I was considering, because it gets to be 110 degrees in my garage, that helps the
water heater work less.
So, before you install such a system, find someone who has a 5yr or 7yr old version, and see
how happy they are. Also, see if AFTER that experience they kept installing similar technology.
Look at the whole picture. But a 15yr payback... I would find a 10% savings you could do NOW!
With any work, you could probably save 20% (Heck just reading the electric bills in some countries,
I learned that they charged more for electricity in the 6:30am-9am time frame. Because people were
turning down the thermostats to go to bed, then cranking them up to take their showers, etc). Huge savings, programming the thermostat in reverse, to basically shut off during those times!
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Our entire office is run on two parking pads roofed with PV panels, linked by 20+ microinverters to produce a peak power of 28kVA. It produces enough surplus in the daylight to pay for the grid power used at night. From what I've seen recently, a breakeven point at 15 years seems about right, maybe just a tad too long. The life of the PV panel should be about 20 years, so you'll have a few years of free stuff before you have to pay all over again.
Will Rogers never met me.
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Luton is a magical place...which probably explains why so much stuff goes missing there.
I had a Girlfriend from Luton once. When she put her Pyjamas on I didn't know if she was going to bed or going shopping.
The kids in Luton are thoughtful. I saw a bunch of them hanging up a "Happy 30th Grandma" banner the other day.
They filmed a series of CSI:Luton but no cases got solved as nobody had any Dental Records and all the DNA was the same.
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My girlfriend from Luton did quite the opposite. She went out in her pyjamas, I still wonder where she went.
I've got it already, my coat.
Life is too shor
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P0mpey3 wrote: Happy 30th Grandma
If you had 30 Grandmas, you'd probably want to keep that quiet.
Damn Lutonians, don't know how to use a comma, mumble, grumble, ...
"These people looked deep within my soul and assigned me a number based on the order in which I joined."
- Homer
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Yep. The only decent thing is to draw a line at 29.
Life is too shor
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P0mpey3 wrote: They filmed a series of CSI:Luton but no cases got solved as nobody had any Dental Records and all the DNA was the same
Ok, now THAT's funny
If it's not broken, fix it until it is
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It would be wrong to post this to Dave, wouldn't it?
veni bibi saltavi
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Why not post it on his blog/website? Sure will make his constituents remember him!
Life is too shor
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I assumed he still lurks, even if he doesn't post.
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The magistrate has ordered him to stop that. It's just creepy.
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