Looking for the next big "wow" factor for your home?

"How can I improve my home so I can make more money when I sell?" That's the #1 question I get as a real estate agent.  And from paint colors to stainless steel appliances and great rooms to outdoor rooms, the answer is always changing.

I see some trends converging that makes me think I've discovered the next big thing for home improvement/resale value.  And that big thing is energy-efficiency.  Some might call that green and my favorite shade of green is the color of the stuff in my wallet.  I think that's the color green buyers will be seeking, especially in the next few years.  They will be buying the homes that offer the most energy-efficiency and smallest utility bills.  The sellers that start planning for this trend now are going to get a three-fold bang for the buck:  lower bills, a federal tax credit on some improvements and reduced market time/increased value at resale. 

Here are three trends that I see really driving energy-efficiency to the forefront:

*  There's already plenty of research out there that says 50% or more buyers are interested in green features - particularly when there's potential to reduce monthly costs or maintenance expenses.

*  The Federal Stimulus Package in February 2009 offers homeowners up to $1500 in tax rebates through 2010 for energy-efficiency improvement projects like replacing windows, furnace or air conditioning or adding insulation.

*  There's been huge strides in making green building for new homes more mainstream, but the majority of those homes are out of reach for buyers who are interesting in purchasing an existing home because of price, features, location, etc.  Sellers who update their existing homes to be more green can create instant inventory to stand out to that tempting pool of buyers in point #1!

Still not sold on the green trend?  I know there are a lot of skeptics out there.  But here's a framework to cut through all the green buzz out there today, and focus on what will be important long-term.  For home sellers it shakes out in three phases:

*  For the short-term it's 5x10:  If you can spend up to $5000 in energy-efficient improvements, do it before 2010.  For example, if you're thinking about windows, furnace, air-conditioning or insulation and you spend $5000 before 2010 and you'll earn a federal tax credit of $1500 making your overall investment only $3500.  Plus, you'll see a significant savings on your monthly bills.  More on how to spend that $3500 most wisely in another post soon!

*  For the mid-term when the market normalizes and the buyers are back they will be seeking out energy-efficiency.  We'll also see a return to more responsible management of household expenses and homes that have features to reduce heating and cooling bills will be very appealing.

*  For the long-term...well, you'll just be too late.  I think in about 10 years or so we'll see green building codes built into all building codes.  So homes that are energy hogs will be outdated and less appealing.  We'll also see that appraisers not only understand how and why energy-efficiency features make a home more valuable, they'll start looking down on the homes that don't have any of these features.

So if there are drafts in your home or utility bills that have been driving you nuts anyway, now's the time to probe a little more deeply and figure out a home improvement project or two to make your home more energy efficient.  It's always fun to be trendy - especially when it makes you more comfortable and saves you money!