Renovation Loans

5 Environmentally Friendly Home Improvement Projects That Can Actually Save You Money

Want to make your home more comfortable and energy efficient? Consider these cost-effective projects.

Home renovation projects present an exciting opportunity to modernise or even increase the value of your home. While changing the appearance of your place can feel good, it can also make your home more efficient and save you money. In fact, there are a number of ways you can reduce your environmental footprint without sacrificing comfort or financial savings.

Small Touches While Renovating Your Home

If you're already planning a large scale remodeling, it's also a great chance to make minor adjustments to your home that will help you save money. For example, if you're already renovating an entire room, it may be worth adding a ceiling fan. Not only are ceiling fans more efficient at cooling rooms compared to standing fans, they can help you reduce your reliance on your air-conditioner, which can result in substantial savings. The National Environment Agency (NEA) estimates that switching from an air-conditioner to a ceiling fan can save households S$460 annually.

It can also be helpful to keep your home cool during sunny days. When you are renovating, it is possible to install features such as curtains, blinds or solar window films in order to reduce the amount of extra heat that enters your home. Alternatively, you can build partitions between rooms in order to limit the amount of space that must be cooled. Finally, properly insulating your home can ensure that it is more efficient at keeping in cool air.

Conserve Water & Money with a New Showerhead

In addition to saving electricity, water conservation is another affordable way for households to cut down on their utility bills. For example, the average 4-room HDB household's water bill is about S$43, according to the Public Utilities Board (PUB). Water used for showering accounts for approximately 27% of households' water usage. Therefore, showering alone costs families about S$139 annually. Using this figure, families could reasonably expect to save about S$56 by upgrading to a 3-tick showerhead. This is a relatively affordable savings opportunity as these fixtures can cost as little as S$20.

Energy Efficient Appliances Save Money in the Long-Run

Buying energy efficient appliances can be a great way to make your home greener without sacrificing comfort. Because air conditioners represent more than one-third of most home's energy consumption, they are a great place to start when remodelling. Over the course of an air-conditioner's life-span, a 3-tick unit costs approximately S$1,666 less than a less efficient 2-tick unit. Therefore, households that are renovating and trying to choose between air conditioner types have a clear choice when it comes to saving energy and money.

Estimated Life-Cycle Cost Comparison

NEA also estimates that 3-tick refrigerators reap electricity savings of about S$75 per year, compared to less efficient alternatives. You can save even more on your utilities bill by researching the most affordable electricity plans available as well as by paying with a credit card that earns cash back on these payments. For example, some cards offer as much as 6% cashback on utilities.

Renewable Energy in Your Own Home

For households living in landed homes, installing a solar powered energy system can offer extraordinary long-term savings. For instance, even a small photovoltaic (PV) system (5 kW) can offer more than S$1,000 in annual savings. The savings realized due to these systems can make up for their high up-front costs (typically about S$10,000 - S$15,000) in about 10 to 15 years. To get a better idea of how much electricity your home could generate, it is best to contact an expert in the field that can give an accurate assessment. These professionals can better estimate the costs and benefits given the specific characteristics of your home.

Estimated Annual Electricity Bill Savings from 5 kWp PV System

Low Cost Option: Energy Efficient Light Bulbs

Some households don't have the means to purchase a PV system, much less a new refrigerator. Fortunately for these individuals, it is still possible to find easy ways to cut down on electricity usage without massive upfront costs. For instance, LED lights are very cost-effective alternative to less efficient light bulbs. These efficient bulbs can save consumers more than S$100 over several years, a very significant amount given the low upfront cost of S$7.

Light Bulb Cost Comparison

Making Home Improvements Affordable

Despite their cost-effectiveness, some home improvements are more expensive than others. For this reason, it is important to have a plan for paying for your project. The most prudent method is to plan in advance and use accumulated savings. However, this is not always an option for all households. Therefore, it is worth researching renovation and personal loans that can be used for various projects. Renovation loans are traditionally reserved for those remodeling their home (i.e. not purchasing new appliances), but tend to offer lower rates than general loans. For instance, Maybank's renovation loans offer particularly competitive interest rates. On the other hand, if you need financing for an appliance or other expenses not covered by a renovation loan, it is important to consider the best personal loans available in order to reduce the total cost of your project.

William Hofmann

William is a Senior Research Analyst at ValueChampion Singapore, focusing on banking and SMEs. He previously was an Economic Consultant at Industrial Economics Inc.

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