Demand for geo in my area is so unprecedented that the supply pipelines are nearly empty. Sizes that previously were not called for (particularly 3 ton), are used up due to the retrofit market. Many of us here have repeatedly said that regardless of brand or style (watersource or DX) go geo. If you are sitting on the fence.......you lose. With rising fuel oil and propane costs modest homes are looking at 4K annual heating expenses and installs are approaching 2 months out. In other words, as we're approaching winter, every couple months you wait cost you up to $1,000.

Where are you located Joe? We're installing our geo this end of September and hope to enjoy the benefits before winter comes. We are also currently have oil heat and this is the reason why we're going geo.

Friends, I think Connie is in NJ. Who can offer a positive refferal near by?
J

In NJ try CMSGEOTHERMAL.COM have heard great things about them. Cover entire state as well as parts of PA.

I would also recommend CMS.....  did a lot or research in the NJ area, and went with the guys at CMS.  Certainly not the cheapest, but I believe they will impress you with their abilities and attention to you. They are out of Bordentown area and are heavy waterfurnace guy's.

I believe the number 1 guy in the state is Jim Soden Heating and cooling, out of trenton.  He is a very nice climate-master guy, but usually an extremely long wait.

there is 1 that you want to stay far away from, so if you live in Monmouth cty or above don't fall for the pump and dump salesman

jh

Thank you guys! We have this contractor who I already have a contract with in Bergen County. He's done few geo. and he's doing about 5 houses in New Jersey at the moment. It's not cheap too (31.5 K) but I trust this guy because he's done good jobs on our other projects. I work for an architectural office. I'll keep your recommendations in my list as my other friend is also interested too doing it in her own home.

Connie......WOW!!!!! How big is your system gonna be? That seems verrrrrrrrry expensive....

Hi Robin, yes it is very expensive. I already ask two contractors aside from who I chose. The first guy even said it'll be around 50K and the 2nd guy estimated about 28K+permits.

The system is about 2 1/2 ton on less than 2000SF. I don't have ductworks plus they have to rip my basement ceiling and put it back to the old condition. My contractor said he'll bore 6" dia. hole (closed loop) vertical around 400'(i'm not sure how long)

28K+ for 2.5 tons? Wow. You might want to ask them for a quote if they don't do the ceiling and other dry wall repairs and you get your own guy to do it.

Yes, do you have a price just for the geo Connie? I can't see how in the world that would ever have a payback in a lifetime for just 2.5 tons.......

2.5 tons sounds marginal on a northern house+ half tons tend to cost about the same as wholes on a closed loop system. Did everybody agree on the size?

Robin, I was thinking about the high cost too. Our heat oil consumption every year is almost 1000 gallon every winter and we're still cold because we have to lower the thermostat (less than 68 degrees). The last time I asked about oil is $3.85/gal. and that is when oil has lowered down from $4.25.

While in the summer, it is so hot and sweating a bucket even when we new windows, new siding and insulation.

I guess what I'm buying now is the comfort and savings. I may not recuperate the cost but it may also be a good selling point (having a geothermal heat pump) when it's time to sell which is not happening yet in the future. I will just think that I bought a very expensive car that doesn't depreciate the value :-)

Excellent point.   Comfort is a big factor in these considerations.

Take this for what it's worth but the Appraisal Institute says that for every dollar saved in a homes operating cost increases the home's value by $20.  If this approach has merit, and I don't know for a fact that it does, it would mean a $100 a month in savings would translate into a $24K increase in the home's value.  Given today's energy cost issues and projected increases down the road, I suspect the idea has merit.  I would think the unanswered question is by how much.

Certainly comfort is huge.  Compared to traditional air conditioning and a gas furnace, I'm finding it hard to understate the value of 50% humidity for comfort.  I used to get chilled in the winter with the gas furnace and that doesn't happen anymore.  Problem is, I can't get a balloon to stick on the wall anymore.

In our area value -subtracted- from homes with propane or fuel oil appears to be about 10%. Among other projects, i've commissioned a real estate guru to try to difine a supportable value add with comps.
J

Joe, so if the value of the home is 100K-10K = 90K? with houses heated by propane and oil?

Appears so, but you'll notice I didn't say geo value adds only that propane subtracts. There is still some ignorance out there.

The $1 savings to $20 value sounds essentially like a 5% cap rate calculation.....not unreasonable, but used more in the valuation of income streams in commercial buildings.

A more sellable calculation would be doing a present value calculation using anticipated monthly savings over the life of the installation.  You would have to make some assumptions on how the savings would grow over time due to escalting energy price and assumptions on the inflation rate, but it is a few minutes of work with Excel and it would be easy to run sensitivity analyses for different assumptions.  Remember, that the anticipated savings, the growth of the savings and the rate of inflation are all ASSUMPTIONS.  We all know what can happen when we ASS U ME (it makes an ass out of you and me)

Intuitively, a 5% cap rate sounds a bit on the high side.......but probably not by much.  From a commercial building standpoint, the ability to reduce operating expenses is a POWERFULL way to increase a building's value.

Bruce

It seems just as much as comfort, the idea would involve safety too.
1. Geo has nothing that can explode.
2. Geo only goes out if your electricity has a problem. Oil and propane could end up not reaching your house simply because some delivery guy wants to take a longer lunch break on the day you need your drop off. Not sure as I've never lived on propane or oil before, but I hope to never learn about it, that's part of why I called Joe.
Joe, if you still having that real estate agent looking, my area is a pretty good way to calculate it. As far as I know, all my immediate neighbors are on propane, but about a half mile in either direction, there's natural gas neighborhoods with similar size houses (although most of them with less land). Of course, being where we have propane seems to also mean I'm where I can't get cable either (can't put in a repeater to get that last 20 ft!), so maybe that's part of the devaluation.

For fun, I ran the following net present value calculation:

20 years (240 months)

$1200/yr ($100/month) current savings excalated at 10%/year for utility cost increases

3% annual inflation rate

The NPV is ±$47-52k depending on whether you compund monthly or annually.

The greater the spread between utility inflation and annual inflation, the larger the number.

At 15 years, it drops to ±$28k and to ±$15k at 10 years.

It definitely justifies the expenditure and should justify a higher valuation or sales price.

Bruce