Tips for Conducting a Home Energy Audit

Today’s typical family living in a three-bedroom, two-story home spends about $2,500 in energy costs each year. To better manage those costs, consider conducting your own energy audit.

First, find out how much energy is being used, by keeping a log and reading your meter each week. At the end of four weeks, add up the kilowatts used and divide the total by the number of days to get your average daily usage. Once the audit is complete and changes are made, monitor usage again. The next step is to walk around the house and check for the following:

Inside

•    Any air leaks and gaps at baseboards and where the walls and ceilings end up joining

•    Air leaks around electrical outlets, switch plates, window frames and baseboards

•    Gaps and cracks in weather stripping around doors, fireplace dampers, attic hatches and air conditioners

•    Gaps around pipes and wires

•    Air leaks from mail slots

•    Rattling from windows and doors, and daylight leaking in around frames

Outside

•    Air leaks where two building materials meet

•    Improperly caulked doors, windows and outdoor outlets

•    Cracks in the mortar, foundation or siding

•    Missing insulation in the home’s structure

•    Improperly functioning heating/cooling equipment

•    Filters that need to be replaced on forced-air furnaces

Why Buying a House on Emotion Is a Losing Strategy

For years, economists have used the study of behavioral finance to explain the role emotions play in investment decisions. Their observations have turned up some interesting results.

First, they’ve found that while investors know very well that the stock market has its ups and downs, some will still base investment decisions on the assumption that what’s happening now will continue in the future. For example, the home buyer driven by a hot market will engage in bidding wars, assuming that the market will continue to heat up. The buyer believes he or she has to buy now or lose out.

Second, they’ve found that other investors follow the “anchoring” concept, in which they hold off selling an asset in hopes that it will increase in value despite evidence to the contrary. In this scenario, home buyers stubbornly anchor themselves to an offering price even though the seller and buyer are only a few hundred dollars apart.

Third, they’ve found that some investors buy too much house for their budget or they forget about the crumbling foundation, because they love the seller’s decor.

Fourth, they’ve found that other investors fail to see beyond the clutter as to possibilities of a home.

To prevent such problems, the emotional home buyer needs the perspective of a real estate agent. Such a professional can separate the emotion from the investment so your dream house won’t become a nightmare.