Increase the Value of your Home With Natural Gas

New study finds homebuyers would pay $50,000 more for a home with all natural gas appliances.

 

Introduction

Natural gas is an excellent choice for comfort and energy efficiency. It is also a smart idea for home equity and resale value as revealed by a new study conducted by Market Strategies International

About the Study

During February and March 2016, Market Strategies surveyed a representative sample of consumers who recently bought or planned to buy single-family detached homes in NW Natural’s service territory in Portland and Salem, Oregon, and Vancouver, Washington, to gauge the value they place on natural gas services and amenities.

A representative sample of 484 recent and prospective single-family homebuyers completed the survey. Based on the sample size of n=484, Market Strategies estimate the results to be accurate within +/- 4.5% if the survey were to be repeated.

Market Strategies utilized Discrete Choice Modeling, an approach used to describe, explain and predict consumer choices between two alternatives. Study participants were asked to assume they were looking for a new single-family home and needed to choose between two homes with various heating and cooking fuels and amenities.

Study Objectives

  • Measure single-family homebuyers’ fuel and equipment preferences for space heating, fireplace, water heating, cooktop/stove, clothes dryer, and outdoor cooking and heating.
  • Gauge price sensitivity between single-family homes with natural gas service and specific natural gas appliances and equipment versus homes relying on electricity for space heating, water heating and cooking.

Findings

  • Natural gas is important. Nearly 9 of 10 (87 percent) people who recently bought or plan to buy a house ranked having a home with natural gas service as “important” to them.
  • Natural gas is affordable. The top reasons homebuyers prefer natural gas are affordability and better for cooking, followed by heats better and is a more efficient source of energy.
  • 9 of 10 pick the gas home. Given the choice between two otherwise identical single-family homes offered at the same selling price, 9 of 10 said they would pick the home with all natural gas appliances versus the home with all electric equipment.
  • 9 of 10 would pay $50,000 more. 88 percent of homebuyers would choose the all-natural gas home – even if they had to pay $50,000 more for it than for a comparably outfitted, all-electric home at an average price of $381,000.
  • The higher the home price, the higher the preference for gas. At home values of $600,000 or more, nearly all (96 percent) homebuyers said they would spend an extra $50,000 on a home with premium natural gas amenities.
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