9 ideas for eco-friendly home improvements using a HELOC

Sustainability is transforming from a popular trend to a way of life. Around the world, 89% of consumers are consciously choosing greener purchases when a more environmentally friendly alternative is available, according to the 2022 Global Sustainability Study.

The interest in shifting to renewable, energy-efficient choices holds up when it comes to homes too. A 2023 National Association of Realtors survey finds almost half of homebuyers value sustainability as a factor in their purchase decision.

So if you're considering major purchases and renovations, you may be looking at eco-friendly home improvements and wondering where to start and how to finance it all.

Here's a look at the ways a sustainable approach can give your home value, some of the top ecological home improvement ideas and why you might consider a home equity line of credit (HELOC) as a means to upgrade to a modern, energy-efficient home.

Key reasons to boost your home's energy efficiency

Even with having to pay upfront costs, eco-friendly upgrades can translate into real value for your home whether you're planning to stay in it or put it on the market. Consider these significant advantages of going green:

• Cost savings. Depending on the upgrades you choose, you might plug up costly leaks, get appliances that require less energy or use more efficient heating and cooling systems. With smart upgrades, you can save significantly on your utility bills every month.
• Decreased environmental impact. Energy-efficient upgrades often require fewer resources, use them more strategically and minimize waste. You can reduce your carbon footprint without drastically changing your lifestyle.
• Greater energy independence. By producing, storing and using your own electricity, you'll be less dependent on utility companies. Consequently, you'll stress less over price hikes and power outages.
• Increased property value. On average, energy-efficient features boost home values by $8,246, and they can make your home more attractive to buyers. About 90% of purchasers report they would gladly pay more to buy an energy-efficient home.
• Financial incentives. Enjoy special financing programs, cash rebates or tax credits for certain eco-friendly home upgrades. Depending on where you live, you may qualify for a variety of federal and state financial incentives.

9 simple eco-friendly home improvements

Once you've decided to make some changes, you'll discover an abundance of choices for building with renewable products, increasing your energy efficiency and creating a living space dedicated to sustainability. Here are nine of the simplest ways to make high-impact upgrades to your home:

1. Add insulation and seal air leaks

   Heating and cooling your home require significant energy. If you're losing climate-controlled air through the walls, you'll need more energy and money to keep your home cozy. Sealing your home can yield an average savings of 15% on heating and cooling expenses.

2. Set up a programmable thermostat

   These thermostats allow you to schedule your heating and cooling cycles. Set times and temperatures for when you wake up, leave for work, come home and head to bed.

   A smart thermostat gives you additional flexibility, learning about your schedule over time, adjusting to your needs and giving you added functionality through an app. Some electric companies offer customers huge discounts or even free smart thermostats. On average, you can expect to save 8% on heating and cooling costs throughout the year with them.

3. Swap your appliances for Energy Star-approved models

   Technological advancements have yielded an ever-improving array of appliances in recent years. Energy-efficient dishwashers and washing machines use minimal water while offering a quieter wash cycle, better rinsing and improved drying. Energy Star refrigerators provide enhanced insulation, cooling and airflow. When shopping for appliances, check the EnergyGuide tags to see how much electricity each model consumes annually.

4. Switch to WaterSense-certified plumbing fixtures

   Shower heads and faucets with the WaterSense seal meet the U.S. Environmental Protection Agency's criteria for water efficiency. EPA research is clear — upgrading your shower head can save four gallons of water per shower. A WaterSense faucet can preserve an additional 700 gallons per year.

   Best of all, products designated with these seals have been scientifically and consumer-tested for performance. So you'll always enjoy the water pressure and coverage of a great shower.

5. Opt for low-flow toilets

   The average home uses 30% of its indoor water consumption just to flush. The Energy Policy Act of the mid-1990s capped water usage for new, residential toilets at 1.6 gallons per flush. Low-flow toilets typically require just 1.28 gallons per flush, which can mean significant water savings over time. With advancements in gravity and power flush technology, low-flow toilets with the WaterSense seal often match or outperform high-flow models.

6. Upgrade to a tankless water heater

   Tankless water heaters create on-demand, heated water instead of storing warmed water in a traditional storage vessel. Households that require high volumes of hot water, around 86 gallons per day, can see energy savings of 8% to 14%. Homes that require less, up to only 41 gallons per day, perform even better, with a potential for 24% to 34% energy savings.

7. Install a geothermal heat pump

   Also known as a ground source heat pump, a geothermal system transfers heat between your home and the earth. The system typically provides heating, cooling, humidity control and water heating, and you can install one in any climate.

   The energy savings can be massive. Geothermal heat pumps use 70% to 80% less electricity than standard HVAC systems.

8. Mount solar panels

   When you produce electricity with solar panels, you generate clean energy on location. You also consume less from your utility company, which may produce theirs by burning fossil fuels. Need extra incentive? Solar panels can boost property values by 4.1% on average.

9. Create an EV charging station

   Want your electric car ready to go each morning? Consider installing a home EV charging station. Professional setup typically translates to a one-time charge of $1,000 to $2,500. But a home charging station offers greater convenience, safety and savings than a public station. So you can truly enjoy the energy efficiency of your electric vehicle.

Paying for sustainable home upgrades: How a HELOC can help

Many projects for bringing your home into the environmentally conscious 21st century involve the costs of adapting or replacing entire systems. You know they'll pay off eventually, but you also have to finance them now.

Instead of turning toward credit cards or a personal loan, a home equity line of credit (HELOC) can be an ideal financial solution. A HELOC offers you a revolving line of credit — similar to a credit card but at an interest rate that tends to be lower than unsecured borrowing options. With your home as the collateral, you can often find more competitive rates than traditional borrowing options.

In the HELOC's draw period, usually 10 years, you can withdraw funds as needed up to your credit limit. During this time, most lenders only require you to make monthly payments on the interest for the money you have withdrawn. When the draw period ends, it's then time to repay your outstanding balance. You'll pay off the principal and interest accrued at a variable rate, typically over a 10- to 20-year period.

HELOCs are a popular choice for financing renovations because as you upgrade your home, you're often facing inexact costs and multiple bills arriving over time. Tapping a line of credit can give you the flexibility you need.

The bottom line

Eco-friendly home improvements can be a smart choice if you're seeking to both benefit the planet and your wallet. But you may need financial assistance with your initial project investment. By tapping into the power of a HELOC, you can reduce your carbon footprint while keeping your family financially healthy.

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