Building a green home has traditionally been seen as being out of reach due to the costs associated with green building products. Today’s green homes don’t have to cost astronomically more than traditional homes, and the energy savings outweigh any costs that may be higher than non-green options.

Initial Costs

When buying or building a new home, you will have your downpayment and then your monthly mortgage payments. As you are putting your building plans together or considering different house plans with green elements, you will need to not only consider the overall building costs, but also how much your ongoing costs for maintaining the home will be each month. Once you move in you will have heating costs, water bills and other energy bills that will be based on your usage and how energy efficient the home is. So let’s compare a traditional home that costs $300,000 and a green home that costs $310,000 to build.

After a 20% downpayment and assuming a mortgage interest rate of 5.5%, your mortgage for the traditional home would be $1376 and your mortgage for the green home would be $1422, an increase of just $46 per month.

Green Savings

Now we have to look at how much money you could save on energy bills by including the green elements into your home. You only need to save $46 per month in order to break even on the higher cost of building. If the energy savings are more than $46 per month, then your investment is not only paying off for the environment, it’s also putting money back into your pocket.

Tax Savings

As we all know, mortgage interest is tax deductible, so the tax benefits of a higher mortgage can also be calculated. On the mortgage rates listed above, an individual in the 28% tax bracket would also receive an additional tax break of $48 per month.

If you are considering building a green, eco friendly home, it’s important to consider the long term benefits compared to the costs associated. As green becomes more important you can also benefit from tax incentives created by the government and higher resale prices for families looking to buy green homes on the open market.

Photo by Cursedthing

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