Insulation Proves to Add Value to Homes

by Jordan Doria, North American Insulation Manufacturers Association (NAIMA)

It’s been a really good month for insulation (which isn’t something you can say very often). Hanley Wood recently released its annual Cost Versus Value report, which compares the cost of 30 remodeling projects and estimates the value those projects retain at resale in 100 U.S. housing markets. For the first time ever, adding fiberglass attic insulation was included among the projects at an estimated cost of $1,268 nationwide. According to real estate professionals responding to the survey, this upgrade would increase the price of a home at resale, within a year of the project’s completion, by $1,482. That’s a 116.9% return, higher than any other remodeling project considered.

Late last month, the National Association of Realtors (NAR), in conjunction with the National Association of the Remodeling Industry (NARI), released the first ever 2015 Remodeling Impact Report. The report provides data on the cost, recovered value at sale and customer satisfaction of 20 common renovation projects. The data on project cost and expected return of sale are derived through surveys of NARI and NAR members.

Among the projects included in the report was an insulation upgrade. The results in terms of expected payback  indicate an estimated cost of $2,100 for the project, which could translate to $2,000 in added value at the time of sale, resulting in a 95% percent cost recovery (excluding energy savings). These numbers are great, but why should a remodeler care?

  1. Insulation adds value to a home

This is what is new with these surveys. The traditional value propositions of insulation, improved comfort and lower energy bills, are well known and reasonably well understood by customers. However, now there is a whole new value proposition to bring to customers: more insulation improves the value of your home, and it does so more cost effectively than most other means.

  1. Lowering energy bills

There is a big gap between the energy efficiency homeowners want and the efficiency they actually have today. In fact, according to research conducted by the Demand Institute last year, energy efficiency is the top unmet need homeowners, cited by 71 percent at their top unmet need.  This came out ahead of kitchen remodels and other typical projects. From our own research, we know that at least 90% of US homes are under-insulated by current standards, so we know insulation is a viable means of addressing this unmet need for a number of homeowners.

  1. Enhancing comfort

This is the tricky one. Comfort has proven a difficult value proposition to sell on, because it is so subjective and nearly impossible to quantify. However, we know comfort is a driver of home performance upgrades, including insulation. More importantly, it is often cited as the major source of satisfaction for homeowners who have undertaken improvements, often more so than reductions in their monthly energy bill. Remodelers know, better than most, that numbers are all well and good, but remodel decisions are not purely, or even primarily, a numbers game for most homeowners. Look, feel and a “brag factor” are all very important. Comfort can be one of these subjective elements remodelers can use to sell.

While our association is very happy to see the results of these two surveys for insulation, we believe the findings have a deeper meaning. We think improvements to home value speak to the increasing belief that a home which is consistently comfortable, with lower energy bills, strongly appeals to today’s homeowners. Savvy remodelers will find a way to use these findings to augment the value proposition they deliver to today’s customer and, in so doing, differentiate themselves from their competition.



About the author: Jordan Doria is Vice President, Marketing and Communications for the North American Insulation Manufacturers Association (NAIMA) based in Washington, D.C. He can be reached at

| 2/8/2016 12:00:00 AM | 0 comments
Add Blogs to RSS FeedAdd Blogs to RSS Feed