Here’s a Guide to the Tax Credits and Rebates Available for Making Your Home More Energy Efficient

Inspired by a recent article in The Washington Post, I’m able to provide you with a simplified guide to the improvements you can make to your home that might earn you a tax credit or other benefit under the Inflation Reduction Act (IRA).

If you are wealthy, some of those IRA benefits may not be available to you, so check with your tax advisor. Even if you don’t qualify for the tax credits or rebates, almost all of the following investments will produce savings down the road as well as being “the right thing to do.”

Heat pumps to replace your HVAC system and water heater are the first and greatest improvement you can make. Unlike gas and resistance-based electric devices, heat pumps move heat, they don’t generate heat. And a heat pump HVAC system uses far less electricity that a baseboard or other electric HVAC system does. The IRA provides for up to $2,000 tax credit for heat pump purchases, with extra benefits for low- and middle-income homeowners. I haven’t used this company yet myself, but you might contact Sensible Heating and Cooling, 720-876-7166, www.SensibleHeat.net, one of those rare vendors who will talk you into a heat pump HVAC system over a traditional one.

Many heat pump systems, including water heaters, are “hybrid,” meaning they have backup gas or electric resistance functions that kick in or can be activated when the heat pump can’t produce the needed heat. For example, a water heater in heat pump mode has a slower recovery than in conventional electric mode, so if you have a big family (or a teenager) you may find that you run out of hot water quickly and it takes longer than you want to reheat the water in the tank. In electric mode, you’ll get the quick hot water recovery you’re used to.

A heat pump HVAC system will probably work just fine without backup so long as you don’t turn down the thermostat too much overnight. Our office is heated solely by heat pump, and we leave it on 70 degrees 24/7, and it’s still way more affordable than the gas forced air furnace it replaced.

Xcel Energy charges commercial customers about $50 per month (that’s $600 per year!) just to have a gas meter before you burn any gas, which contributes greatly to making gas forced air more expensive than heat pump heating. Note: you need to have the gas meter removed, not just stop using gas, to save that $50 per month. Even in a residential application where the monthly meter fee is less, consider replacing all your natural gas appliances (including your fireplace and grill) so you can have the gas meter removed and save that facility charge plus those other gas-related fees that have exploded of late. There are great electric fireplaces on the market, and Rita & I love our electric grill!

Here’s food for thought: If you get rid of gas in your home and have only electric cars in your garage, you’ll never have to worry about your family being killed by carbon monoxide poisoning. In addition to spending less on home energy and fuel for your car(s), the IRA will reward you for every aspect of that conversion! And with enough solar panels on your roof, your home energy bill will be under $10 per month (to remain on the electrical grid), and you’ll pay nothing to fuel your transportation!

Induction stoves to replace gas ranges not only save you money (including an $840 rebate if you qualify based on income) but can improve you family’s health. Despite right-wing raging about this topic, it has been proven statistically that gas cooking has increased asthma cases in children and some adults. (Click here to read a study on this topic.) The rebate is available on non-induction electric stoves, but induction cooking costs less to operate and heats food and water faster. You can dip your toe in this technology by buying a single countertop induction burner for $50 to $70, as I did. You’ll be amazed. Click here to read an article about how chefs have come to prefer induction cooking. As they say, “try it, you’ll like it!”

Electric cars that cost under $55,000 and trucks or SUVs under $80,000 that are assembled in North America qualify for a federal tax credit of up to $7,500 and a Colorado tax credit of $2,000 (without those federal restrictions, which include an income cap of $150,000 single or $300,000 filing jointly). Even the Tesla Model Y’s base price is now below those price limits.

What’s new with the IRA is that you can get a federal tax credit of $4,000 or 30% of the purchase price (whichever is less) of a used EV that is at least 2 years old, has a purchase price under $25,000, and is purchased from a dealer. I have always advised that a used EV is your best buy, because a used EV is as good as a new EV since it has none of those components of a gas-powered car (such as transmission or engine) which may be about to fail. Google “used electric cars” and you’ll see many for sale by dealers. I just ran that search and found 72 EVs under $25,000 on autolist.com alone!

The IRA increased the tax credit on solar panels to 30% for the next 10 years, and, given the steady reduction in the cost of solar over the past two decades, this investment is a no-brainer, assuming you have a roof that’s not shaded by trees. (Ground mounted solar panels is an option if you have a large unshaded backyard area. Otherwise, consider buying solar panels in a “solar garden.”) Xcel Energy allows you to install enough panels to provide up to twice your average usage over the last 12 months, which is great, because that could provide all the electricity you will need for a not-yet-purchased EV or not-yet-electrified heating system.

My advice is to purchase your solar photovoltaic system outright, not lease it or sign up for a Power Purchase Agreement (PPA). When it comes to selling your house, anything other than a system that is seller-owned could complicate the sale. I’m a repeat customer of Golden Solar (303-955-6332), but also like Buglet Solar (303-903-9119). What these companies have in common, and which I think is important, is that they are local family-owned businesses, which I much prefer over a national firm such a Tesla or Sunrun Solar.

One situation in which a Power Purchase Agreement or lease works better is if the customer is a tax-exempt non-profit (which can’t benefit from tax credits).  Golden Solar put a solar array on the roof of a Golden museum doing a PPA that Golden Solar financed, taking the tax credit for it.  The museum pays no more than they were paying Xcel Energy to Golden Solar but will own the system after a few years. If you know of a non-profit that would like to go solar, have them contact Don at Golden Solar.

Improving your home’s insulation should always be the first step in saving money on energy. The IRA provides a 30% tax credit, up to $1,200 annually, for such improvements, specifying $600 for windows and $500 for doors. The gold standard in windows and doors is Alpen High-Performance Products, a Louisville CO company, which made the triple-pane windows we purchased for our South Golden Road office — expensive but worth it in terms of comfort and energy savings. Contact Todd Collins of AE Building Systems, 720-287-4290.

Whole-house energy efficiency retrofits are eligible for a rebate under the IRA, based on proven reduction in your home’s energy costs. Speak with someone from a company like Helio Home, Inc.  (720-460-1260) which covers most aspects of reducing home energy use covered by the IRA, from solar to insulation to appliances. The IRA also provides a $150 rebate on a home energy audit, which is an essential first-step to figuring out the best and most cost-effective efficiency improvements you can make. You can learn more about energy audits at www.REenergizeCO.com.

Buy a new washer and dryer! The new top-loading high-efficiency washers are the best, speaking from personal experience. The washer automatically reduces water consumption based on the size of the load; and a heat-pump electric dryer saves on electricity.

Landscaping, done right, can save on energy and water. Think shade trees and xeriscaping, or installing buffalo grass, which requires little watering or mowing. Call Darwin at Maple Leaf Landscaping, Inc. (720-290-8292), a client of mine, to discuss the possibilities at your house.

If your house doesn’t already have one, a whole-house fan is a great energy saver, allowing you to flush hot daytime air out of your house before activating the A/C when you come home. It can also allow you to leave the A/C off overnight by bringing in cool nighttime air on a quiet, low-speed setting. Whole-house fans cost between $500 and $2,000 installed. They don’t earn their own IRA benefit, but would contribute to the benefit you earn with the whole-house retrofit mentioned above. I am a happy repeat customer of Colorado Home Cooling, now part of Colorado Home Services, 303-986-5764.

Not mentioned in that Washington Post article was daylighting of your home, which is one of my favorite ways to reduce electricity consumption by drawing sunlight into dark interior spaces. I installed Velux sun tunnels in two of my past homes, including in a windowless garage, and in our former office on South Golden Road. For that, I used Mark Lundquist, owner of Design Skylights (303-674-7147).

As Usual, This Year’s CES Show in Las Vegas Featured Some Exciting New Home Technologies and Products

Formerly called the Consumer Electronics Show, CES 2023 made headlines in January for its focus on electric vehicles and EV technology, but it also featured many home-related technologies and products which made headlines at Realtor Magazine. Here are their Top 10 innovations displayed at the show.

First was LG’s ArtCool Gallery, a wall A/C unit disguised as a framed photograph or artwork provided by the user. In 2022, I showed a Willow Springs listing which had this kind of wall unit in various rooms of that home. Below is a picture from that listing. The picture next to the window is the A/C unit. When running, the picture tilts out from the wall an inch or two to allow for air flow. As with a mini-split wall unit, two tubes carrying fluid connect it to a heat pump next to the house. One heat pump serves the units in several rooms, although each has its own remote-like thermostat. Curiously the listing agent didn’t state on the MLS that this was a heat pump system — a big selling point!

I don’t think the units in that listing were from LG, because the LG website shows the availability and price of theirs as “TBD.” Such units are clearly driven by a heat pump, but nowhere on LG’s website could I find the words “heat pump.” Rather, the website refers to a “dual inverter unit.” I find this peculiar because heat pumps are now all the rage. The website also did not mention the substantial tax credits and rebates now available for heat pump installations under the Inflation Reduction Act (IRA).

Second was Kohler’s “Sprig Shower” device, coming this spring, which infuses a shower’s water stream with scents and oils. Kohler will initially offer six different scent pods, including lavender, chamomile and eucalyptus. The unit will cost $119, and a 6-pack of single-use pods will cost $21.

If you’re looking for an interesting alternative to stainless steel, you might be interested in LG’s new MoodUp Refrigerator, which can display 190,000 different color combinations on the LED screens on the front of the fridge.

Meanwhile, Samsung is bringing to market this spring its “Bespoke” refrigerator which has no handles. Both doors open by touching them.

For $6,500, you can replace your home’s front door with Masonite’s “M-Pwr Smart Door,” which incorporates a downlight and two side lights which turn on when you approach it, plus both a smart lock and Ring video doorbell. It is connected to your home’s electricity, but includes a battery backup so you can still get in if there’s a power failure.

For $11-17,000, you can replace your staid old bathtub with Kohler’s “Stillness Infinity Experience,” which brings a “Zen-like, multi-sensory experience, combining water, lighting, mist, essential oils and soothing sounds.” Water cascades over the top into a wooden moat, from which it is filtered and pumped back into the tub.  I’ll pass on this product!

Is pushing buttons or using a key difficult or too much effort for you?  For $189.99, you can buy Lockly’s “Flex Touch” fingerprint deadbolt, shown here.

Do you have a Roomba robotic vacuum and wish there was a robot that could mow your lawn and clear snow from your driveway, walkway and sidewalk? Well, your ship has come in! It’s the Yarbo 3-in-1 Intelligent Yard Robot, below, which has attachments for those two tasks and many others, which are demonstrated at www.Yarbo.com.

Completing Realtor Magazine’s Top 10 products for CES were touchless window shades from Eve which respond to voice commands; a 2-wheeled family robot from Enabot; and the “M3 OLED Smart TV” from LG, which is totally wireless except for the power cord.

Here’s a link to the Realtor Magazine article, which has links to all 10 items.

Do you have a favorite new product that has made your life better, more interesting, or more sustainable? Tell me about it (my email is jim@goldenrealestate.com), and maybe I’ll feature it in a future column. And let me know if you purchase one of the products featured above!

Canadian Company Develops Recycled Rubber Roofing

The picture above is of Euroshield® roofing made from recycled tires. It is manufactured by G.E.M., a company in Calgary, Alberta. Henry Kamphuis founded the company in 1999 to solve the problem of old tires clogging up landfills and dumpsites. Several years later, after much research and trial-and-error, he came up with a green roofing system that is 95% made from the rubber in old tires. It takes over 400 such tires to provide the rubber for a typical roof.

The roofing tiles are connected by a tongue-and-groove design and can be made to look like slate tiles, shown above, or wood shakes.

The roofing is sold and installed in the Denver metro area by Johnson Construction Company LLC, which you can reach at 303-719-7663, or via their website, www.RoofsByJohnson.com. The cost of a Euroshield roof is more than twice that of a conventional composition shingle roof, but it comes with a 50-year warranty against damage from up to 2” hail with no pro-rating and no deductible. The company installed a Euroshield roof in Golden’s Amberwick subdivision after a 2017 hail storm. Those roofs survived two subsequent hail storms without any visible damage.

Just Listed: A South Golden Ranch in Eagle Ridge with Walkout Basement

This rare ranch-style home with a southwestern feel at 634 Entrada Drive is on a mini cul-de-sac, giving it an oversized backyard with a water feature (stream & pond) that you can enjoy from the newly rebuilt wood deck off the living room and primary suite. It was just listed for $775,000. A 10’x13′ office is used by the seller as a 3rd bedroom minus only a closet. An open floor plan links the spacious living room to the kitchen over a breakfast bar. The living room has a gas fireplace. There’s attractive use of glass brick in the dining room and kitchen and also in the garage. New carpet has been installed, making this home move-in ready. The walk-out basement is unfinished but with a half bath installed. Interior photos and a narrated video tour are at www.SouthGoldenHome.com. Broker associate Jim Swanson, 303-929-2727, is holding it open this Saturday, 11am to 1pm.

Fannie Mae Requires Appraisers to Use a Measurement Model for Square Footage Not Used by Realtors

How we measure the gross living area of a home is important, but there is little consistency. Different websites may use different numbers for the same home, primarily because they tend to have only one field for square footage.

Below, I’ll write about Fannie Mae’s new rules for measuring homes, but it’s up to each real estate website operator which number it uses for square footage. For example, the web page that we create for each Golden Real Estate listing has only one square footage field, so I choose to display finished square footage. The MLS has fields to distinguish between finished, unfinished, basement, above-grade, and total square feet, as shown below, and all those fields are uploaded to every consumer website, but I haven’t found any consumer website which displays all those fields.

Zillow is an example of a website which features only the total square footage in each listing, even if half that area is unfinished basement space. It doesn’t show the breakdown of finished vs. unfinished space or basement vs. above-grade space unless you click on a link titled “See more facts and features.”

Trulia, which is owned by Zillow, has a link “See all” which lists “finished area” if you scroll down far enough, but that’s all. I find this ironic, because both Trulia and Zillow provide a ton of information not found on the MLS, yet they downplay or omit the most important detail of all — the breakdown of square footage.

Redfin, which, like Trulia and Zillow, gets the full feed from our MLS, also features only the total square feet and has no link that I could find which displays a breakdown. And, like both Trulia and Zillow, Redfin prominently features “price per square foot,” but that figure is based on the total square feet, which can be really misleading.

Golden Real Estate’s website, like those three, gets its active listings from the MLS, but our display is managed by the MLS, and all listings on our website use the finished square footage number, which is, I believe, the most useful single number to use. But, once again, there’s only one field for displaying square footage.

The MLS has its own consumer-facing website, www.REcolorado.com, where you can search for listings. On that site, the total square footage is featured, but scroll down and you see this very thorough breakdown of square footage:

On other websites, you’d only see 3,166 square feet and $271/sq. ft. for the listing in this example.

The numbers  displayed on the MLS are entered by the listing agent. Our sole obligation in providing them is to indicate the source. It could be from public records, or it could be from a prior appraisal. We could also measure it ourselves, but that is really unlikely. The only requirement is that we disclose the source. The safest choice is public records, but those numbers could be wrong.

Fun fact: Square footage of a home, by whatever standard, is measured from the outside of the exterior walls, not the inside.

Lenders, of course, want to know that the square footage is accurate and consistent, so recently Fannie Mae mandated that all appraisers follow the ANSI (American National Standards Institute) standard, which can result in appraisals which come up with different numbers than in the MLS listing on which the buyer relied.

The ANSI standards don’t allow for space with ceiling heights under 7’ to be included in the gross living area, and the square footage of staircases can only be counted on the level from which the staircase descends. Also, if even part of a level is below grade, the entire level has to be counted as “basement,” which directly conflicts with MLS rules which say the lower level of a bi-level or tri-level home (which is at least partially below grade) can be counted as above-grade square footage.

Complicating matters, appraisers must measure properties using the ANSI standards, but they have no choice but to rely on MLS measurements for the comps they cite in an appraisal, which were surely not done to ANSI standards. The technical term for this is “apples and oranges…”

There are three different square footage numbers for every MLS listing, and here is a quick tutorial on REcolorado’s rules for measuring square footage.

Above-Grade square footage used to be called “Main” square footage. As the new name suggests, it does not include basement square footage.  But that begs the question, “what is a basement?”  In a split-level home, the lower level, which is often below grade, is included in the “above-grade” square footage, since there is frequently a basement below that level. In a “raised ranch” home, the lower level is included in “above-grade” square footage for the same reason. (A “raised ranch” is defined as a home where you have to climb a flight of stairs to get to the “main” level. The “main” level is defined as the level containing the kitchen.) 

Finished square footage includes all the finished square feet, whether in the basement or above-grade. If the basement is unfinished (or there is no basement), this number will be the same as the “Above Grade” number.

Total square footage is what the name suggests, whether finished or unfinished.

All three of these numbers will be different when a listing has a partially finished basement.

The Real Estate Market Is Showing Signs of Revival

Here at Golden Real Estate, we have some anecdotal evidence of a resurgence in the real estate market, which was moribund in December.

On Saturday, Jan. 7th, I held a 2-hour open house at my listing on Bates Avenue. My previous open house at that listing had drawn not a single visitor, so I was quite surprised to have ten sets of visitors that day. All of them were actual buyers, not lookie-loos.

I immediately decided to hold it open the following day, Jan. 8th, and once again it was my most visited open house in recent memory.

I had four prospective buyers from those open houses and this Monday that home went under contract.

A second example of this resurgence came when broker associate David Dlugasch listed a 1960 brick ranch with walkout basement in south Golden/Pleasantview. (It was featured in last week’s ad.) It drew 22 agent showings on the first three days, and it went under contract on Sunday at full price — $798,000, which I frankly thought was a reach.

Although anecdotal, these experiences give me hope for a continued market resurgence in 2023.

For Sale: Golden Real Estate’s Former Office Building on South Golden Road

Currently vacant, this unique 1,318-square-foot office building at 17695 S. Golden Road (originally a restaurant) is powered by 20 kilowatts of solar power, which more than meets the energy needs of the building in addition to charging up to three electric vehicles at three Level 2 charging stations. The monthly bill from Xcel Energy is only $12.56.  There is no natural gas service, because the building is heated and cooled by a state-of-the-art heat pump/mini-split system powered by those solar panels. This is a true “net zero energy” building and was planned to be “The Net Zero Store,” but we decided to stick to real estate and sell the building. For a showing, call Jim Smith at 303-525-1851. You can take a narrated video tour and view interior and exterior photos at www.SouthGoldenBuilding.online.

Note the 5 kilowatts of solar panels on the building roof.

View of parking lots and 15 kilowatts of ground-mounted solar panels.

One of three wall-mounted mini-splits driven by a heat pump on roof, provides both heating and cooling at no cost thanks to solar panels.

Four Velux sun tunnels (similar to Solatube brand) provide natural light

Golden Real Estate wants to rent back this secondary parking lot plus the two sheds and Styrofoam Corral behind the building for $200/month.

Two ChargePoint charging stations earn average $50/month at no cost to building owner because of solar power.

This Tesla charging station earns $75/month from an Uber driver.

Harvesting ‘Atmospheric Rivers’ to Replenish Aquifers and Fill Reservoirs

A recent article in the San Francisco Chronicle caught my attention. It spoke of harvesting the rainfall from otherwise catastrophic “atmospheric rivers” to refill reservoirs. Another piece by the Environment Defense Fund in Oct. 2021 discussed research being conducted by the California Department of Water Resources and UC Santa Barbara on harvesting excessive rainfall to replenish underground aquifers.

Meanwhile, we are reminded daily that the Colorado River is drying up and both Lake Mead and Lake Powell, as a result, are suffering reduced levels that threaten the water supply and could even sideline vital hydro-electric turbines.

 I’m reminded of those amazing 20th Century California projects which moved water all over that state to meet both agricultural and urban demands, and it got me thinking about the possibility of creating another grand project to divert some of those ocean-bound flood waters to both in-state reservoirs and to the Colorado River.

Not only could that help with the Colorado River shortfall, but it might help in some small way to reduce flooding. 

Replenishing aquifers is a good idea, but can that be done at speed? I’m not knowledgeable in this area, but it seems to me that new reservoirs would have to be built to hold the water that is to be pumped into those aquifers.

Capturing flood waters on our side of the Continental Divide is already handled by the many reservoirs such as Chatfield and Cherry Creek Reservoirs designed for that purpose. Chatfield is owned by Denver Water, but Cherry Creek is owned by the Army Corps of Engineers. The dams for each are higher than needed in order to accommodate sudden downpours, flooding only open land and park facilities.

PS: Here’s a related article from TheConversation.com:

Here’s a Solution to Your Snow-Packed Streets

Does your street still look like the one above — over two weeks after the snow stopped falling?

Would you pay $1 or $2 to have someone plow your street before the snow gets beaten down, rutted and icy?

If you live in the City of Golden, this is not a problem. It’s the only city I know of which has committed to plowing every residential street, no matter how small the snowfall. (If you know of another city that does that, let me know, and I’ll share it.)

If your street is not being plowed, there’s a solution in plain sight, but only if you have an HOA or neighborhood association. Lobby your HOA to hire a person or company to plow your street immediately after each snowfall. The cost will be in proportion to how many streets and homes are in your subdivision, but regardless of size, I bet your association could find a person or company who would do it, and the cost would probably compute to no more than $2 per household per storm. Ten plowing events a year might cost $20 per household, but even it if were twice that, wouldn’t it be worth it?

Your association would probably not even have to raise their monthly dues for such a small expense. Google “snow plowing companies near me,” and get some quotes. Be your neighborhood hero and solve this recurring problem!

(If your HOA, not the city or county, owns and maintains your streets and/or if your community is gated, the HOA is probably already plowing your streets when it snows.)

The above picture is of the street in front of my listing at 14165 W. Bates Avenue. When I returned the day after taking that picture, I found a City of Lakewood road grader and dump truck working in tandem to scrape up the ice-caked snow and plow it to the side. Lakewood would have saved money by following Golden’s example and plowing the street when it snowed! Later that day, I found four Lakewood workers on foot chopping and removing ice on Union Blvd.

Media Literacy Needs to Be Taught in High Schools

This week I was made aware of a social studies teacher in Chicago who introduced media literacy as a 5-week segment of her class at Whitney Young High School, according to an article from Chalkbeat.

The inspiration for adding media literacy was the Jan. 6, 2021, insurrection. To quote the Chalkbeat article, the teacher “scrapped her lesson plans for February and spent the entire month focused on media literacy. Among her goals: to help her juniors and seniors discern fact from fiction, identify credible sources of news, and spot misleading information.”

Every citizen, not just high school students could benefit from learning, at the very least, that news outlets carry both hard news articles and opinion columns or segments and learn how to distinguish one from the other.

They should learn about QAnon and its origins and the outsized role it has played in recent events, not just the Jan. 6 insurrection. They should learn that “if it sounds too good to be true or too bad to be true,” it may not be true and how to utilize the internet (such as on www.snopes.com and other fact-checking sites) to research such items and not to forward those juicy and seductive emails or blog posts without verifying them.

No one likes to be duped, right? Liars count on you to spread their lies.