A variety of new tax rebates, grants and other financial incentives are making home-renovation projects more attractive than ever. With the recently introduced federal Home Renovation Tax Credit, created to help stimulate the economy, homeowners can get a tax credit (up to a maximum of $1,350) for eligible home renovations costing between $1,000 and $10,000 that are made after January 27, 2009, and before February 1, 2010.
Renovations for a greener home
If renos are eco-friendly, home-owners may also qualify for up to $10,000 in federal and provincial grants. Green home renovation grants are available through the Natural Resources Canada (NRCan) ecoENERGY Retrofit program, which encourages homeowners to save energy by retrofitting their homes with greener solutions. Property owners can receive up to $5,000 through the program for energy-efficient upgrades. Making ecoENERGY-eligible renovations can then qualify homeowners for up to an additional $5,000 in provincial and other local grants.
With ecoENERGY-qualified retrofits, you’ll benefit not only from the initial grants, but also from lowered energy bills, which can be reduced up to 40%, according to NRCan. And green renos can also create a healthier living environment for your family. Plus, greener homes can fetch a premium on the market, as future buyers are assured lower energy costs.
While the program does cover state-of-the-art technologies, it also covers common maintenance initiatives such as replacing old heating and cooling systems with more efficient Energy Star–qualified ones, adding insulation and replacing windows.
How to get an ecoEnergy grant
In order to qualify for ecoENERGY grants, homeowners need to have a pre-renovation energy audit performed by an independent, NRCan-certified auditor. You can find an auditor in your area through the ecoACTION website. The auditor will inspect your home and provide a detailed report with a list of retrofit recommendations.
The audit costs approximately $300, but you may be eligible for a partial rebate through provincial programs. Ontario, for example, will give homeowners up to $150 back; low-income homeowners in Nova Scotia may get a full rebate. You don’t have to perform all the changes that are recommended in the audit, but new fixtures need to be on NRCan’s approved list and meet certain efficiency requirements. A second post-reno inspection is performed to verify the upgrades and provide a rating of your home’s energy efficiency level. After the initial audit, you have 18 months or until March 31, 2011, to complete renovations and get the results of the post-renovation audit. The results are then forwarded to the government so you can apply for the rebates.
Kitchens and bathrooms
According to the Appraisal Institute of Canada, kitchen and bathroom improvements are among the renos that give the best return on investment. If you splurge on an upgraded bathroom or kitchen, you can generally get 75% to 100% of your investment back when you sell the house. But energy-efficient upgrades such as high-efficiency furnaces are also now at the top of the list for both popularity and added value.
Assess your needs
If you’re considering a renovation, it’s important to do your homework. Assess your needs, priorities and finances. How long do you intend to live in the house? This will affect your budget as well as the type of renovations you undertake. The longer you stay in the house, the greater your payback over the long term, especially if you’re investing in some of the more expensive energy-efficient technologies.
It’s also important to think of your home as a living entity. What you do in one room will affect the rest of the house. Replacing your furnace with a more energy-efficient one isn’t going to make a big difference if you’re still losing a lot of heat through a poorly insulated roof and single-pane windows. That’s why home-energy specialists recommend starting with insulation and new windows and doors before anything else, to reduce your baseline energy consumption.
Do it yourself or hire a contractor?
Some projects can be DIY, if you know what you’re doing. For tips and how-to guides, check out the websites for the Canada Mortgage and Housing Corporation and Natural Resources Canada. If you’re committed to going green, there are a variety of new eco-friendly insulation products that can be handled safely including soy- and cellulose-based foam and batting, and even insulation made from recycled denim. Also safe and healthier are newer types of paints, stains and solvents with low or no volatile organic compounds (VOCs)—those nasty chemicals that may cause short- or long-term health issues.
Other projects, however, should be left to professionals, such as major structural changes like moving or removing walls or installing electrical wiring. And if you live in a home built before 1980, there could be lead-based paint, which should never be sanded, or the house may have asbestos insulation, which should only be removed by qualified experts who know how to safely handle the hazardous material.
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