Does Installing Central Air Increase the Value of a Home?

Answer

Whether or not purchasing an air conditioner results in a return on investment is contingent upon a number of different circumstances. When it comes time to sell their houses, homeowners will naturally work to make their properties seem as appealing as possible to potential buyers. However, not all upgrades are created equal; only a portion of the cost of many of these improvements is recovered in the sale of the property, and certain additions, such as central air conditioning equipment, return very little, if any, of their initial cost.

Smart Upgrades

Traditional renovations that increase a home’s value include those made to the kitchen and bathrooms; nevertheless, even these “safe bets” have their limits. In the end, a first-floor laundry closet may regain the bulk of its initial expenditure, but a professional kitchen that has been retrofitted to fit into a two-bedroom ranch from the mid-20th century may appear so out of place that it returns nearly none of the money it took to install. If a homeowner is astute enough to contemplate installing air conditioning, he or she will first consult with a real estate professional about the upper bounds of the value that the addition may bring, taking into account both the property in question and the surrounding area.

Air Conditioning Considerations

Homebuyers have certain requirements that must be met, including that certain systems be in good operating condition and properly maintained. Changes made to a heating, ventilation, and air conditioning system, also known as an HVAC system, are not visible and are regarded as standard pieces of equipment, unless additions include exceptional improvements such as environmentally friendly technology or heat pumps that introduce the possibility of cost savings. It’s possible that these qualities will assist sell the property. When looking at purchasing air conditioning, it is important to keep in mind that the home’s current duct work, air handler, or furnace may need to be adjusted or even rebuilt. This may add thousands of dollars in costs that would not be recouped when the home is put up for sale.

Location

In the same way that location is a significant factor in determining overall pricing, the absence of air conditioning in a house located in a desert or tropical climate may be a more likely reason to discount the price of the home than it would be in a coastal or alpine region, where summer temperatures are typically more moderate. The installation of air conditioning in an area where it is only seldom used may actually raise concerns about the insulation’s potential need for an upgrade. In a great number of regions, air conditioning is seen as an essential component of a full HVAC system rather than a frivolous luxury; but, in regions where the summers are mild, it may seem to be a needless “frill.”

Bottom Line

It is possible that a homeowner may recuperate less than half of the cost of installing central air conditioning in the long run. Instead of considering how much value it may potentially contribute, the choice to install air conditioning should be based on whether or not potential purchasers anticipate it to be part of the heating, ventilation, and air conditioning system. If, on the other hand, the house is located in an area where potential buyers reduce the purchase price of a home because it does not have central air conditioning, it may be prudent to install the component, provided that doing so does not require a significant overhaul of the HVAC system.