Intense Santa Ana winds. Devastating wildfires. Floods. Heat waves. Droughts.
It seems like the planet has some things to say. And as a landlord and real estate investor, it’s not up to you to save the planet.
But, why not be part of the solution?
Why not save money on your operational costs, too? Why not increase the appeal of your rental property and raise its rental value?
Make energy-efficient upgrades that will matter to your tenants, to the planet, and to the rental market.
We have some ideas.
Why Invest in Energy-Efficient Upgrades?
Energy efficiency was a trend years ago; a good way to demonstrate a commitment to sustainability and establish yourself as a landlord who is environmentally aware. But it’s no longer just a trend; it’s a necessity. It’s also a profitable business practice.
Los Angeles tenants today value sustainability, and energy-efficient upgrades can set your rental apart in a competitive rental market. The benefits are undeniable, and because this is something that a lot of properties have adopted over the last few years, we have some real data that shows us:
- Utility Bills are Lower. Energy-efficient properties consume less power and water, decreasing utility expenses for you or your tenants. Tenants pay less when they’re living in the property, and you pay less during turnovers.
- Higher Tenant Retention is Available. Tenants appreciate the added value and comfort of living in an energy-efficient space. This contributes to a better rental experience overall, which makes good tenants more likely to stay in place, reducing the cost of vacancy and turnover for you.
- You Can Enhance Property Value. Sustainable upgrades increase the market value of your property. It becomes more desirable not only to tenants but to buyers when you eventually decide to sell.
- Environmental Responsibility is Valued. Contribute to the fight against climate change by lowering your property’s carbon footprint. This is good for your reputation, and simply the right thing to do, especially against the backdrop of the devastation we’ve seen in California and specifically in Los Angeles with recent wildfires.
There’s no reason not to invest in energy efficiency. You have to upgrade your property anyway, in order to keep it attractive to tenants. Why not make sure those upgrades serve the planet as well as the market?
Top Energy-Efficient Upgrades for LA Rental Properties
Where should you start? That honestly depends on your property. But, we can make some general suggestions to set you off on the right path.
- Upgrade to Energy-Star Appliances
Switch out outdated appliances with Energy-Star rated models. From refrigerators to dishwashers, these appliances use significantly less energy, reducing utility expenses. Tenants are likely to favor rentals equipped with modern, efficient appliances. They’re quieter while they run and they don’t use as much electricity, gas, or water. Look for local utility rebates and tax incentives for upgrading to energy-saving appliances.
- Install a Smart Thermostat
Smart thermostats are especially beneficial to rental properties, and tenants really appreciate them. These devices allow tenants to control indoor temperatures efficiently, reducing wasted energy. These devices not only improve comfort but can lower heating and cooling costs by as much as 20%. That’s not an insignificant savings.
- Swap Out Traditional Lighting for LED Bulbs
Ideally, you would have changed your lighting already. But if not, consider LED bulbs now. Lighting might seem minor, but switching to LED bulbs can drastically cut energy consumption. According to Energy.gov, LEDs use up to 75% less energy than incandescent bulbs and last significantly longer, which means savings for both landlord and tenant.
- Seal Leaks and Add Insulation
A great way to improve efficiency does not require much of an investment from you: consider your insulation and stop any leaks. Ineffective insulation and air leaks can hike up energy costs, especially during Los Angeles’s warmer summers. Updating insulation and sealing doors and windows ensure that cooled or heated air stays where it belongs—inside the unit.
- Invest in Solar Panels
This is a larger investment than all owners like to make, but we want to offer it as an option for investors who are looking to make real change. Los Angeles has a lot of sunshine year-round, so it’s really the perfect market to invest in solar panels. While installation costs can be high, the long-term savings on electricity make this investment attractive. Plus, California offers various financial incentives for solar installations.
- Install Low-Flow Water Fixtures
Save on water bills with low-flow showerheads, faucets, and toilets. These fixtures minimize water usage without sacrificing functionality—an added bonus in drought-prone Los Angeles.
- Upgrade Windows to Energy-Efficient Models
Replacing single-pane windows with double-glazed or energy-efficient models improves insulation while reducing noise—an important factor for tenants competing with the hustle and bustle of LA.
Financial Incentives for Energy Efficient Rental Homes in Los Angeles
Several programs and incentives make it easier to finance energy-efficient upgrades in California:
- LADWP Rebates: Los Angeles landlords can access rebates for energy-saving appliances, lighting, and more.
- Federal Tax Credit: Programs like the Energy Efficient Home Improvement Credit can offset costs.
- California Solar Tax Incentives: Reduce installation costs when investing in solar energy.
Take advantage of these opportunities to offset initial costs and enjoy the long-term benefits of an energy-efficient property.
How Energy Efficiency Appeals to Tenants
Sustainable upgrades attract tenants who prioritize environmental responsibility. Features like solar panels, modern appliances, and smart thermostats make a property feel contemporary and comfortable. Happy tenants are more likely to renew their leases, translating to reduced turnover and more stable cash flow.
Transforming your rental into an energy-efficient space doesn’t have to happen overnight. Start small—swap out light bulbs, seal leaks, or add a low-flow showerhead. Then, gradually move toward bigger upgrades like solar panels, if that’s looking possible for you and the market continues to demand it.
The result? A more competitive property, happier tenants, and long-term savings.
If you’re curious about where to begin, we can talk to you about what we’ve learned from local energy experts and contractors who specialize in eco-friendly renovations. We love working with owners to focus on energy-efficient upgrades. Contact us at Earnest Homes, and we’ll help you set up for a profitable and sustainable future.
