Electric vs Heat Pump vs Gas

[Mark Wikkerink]

Hi everyone

This is my first post, so I hope that it's in the right place!

My wife and I are buying a duplex, to live in one side and rent out the other side. This will be our first home, and in a few years we plan on moving to something else and renting both sides. 

We live in Indianapolis, Indiana, and our property is less than 2 miles from downtown, so we are hoping to attract renters who are young professionals like ourselves.

The home will require a complete rehab, which won't be cheap. It will require all new HVAC, so I am trying to decide which system is best, and where the line is between being efficient but also initial cost.

My choices for HVAC are as follows:

-All electric furnace with heat pump 

-95% gas furnace with heat pump

-95% gas furnace with 15 SEER AC unit

Which system do you think is the best choice, considering we will be living in the property for up to 5 years? Are there any other options? I do want to have lower utilities for the tenants as well, so I can charge a little more ($50-$100) per month, based on the fact that the units are energy efficient (we are also adding insulation, LED bulbs, efficient toilets, shower heads, hopefully water heater, etc).

Right now I am looking at just under $9000 per side, but I talked to the HVAC guy and he had different numbers than our contractor did, so I am getting new quotes from him.

Thanks, and please don't hesitate to ask questions/give feedback.

Mark

[Jonathan Andersen]

 I specialized in heat pumps (NATE certification in Heat Pumps) and serviced and installed any kind of gas furnace or air conditioner you can think of ( for 8 years) before moving on to real estate.  I am copying and pasting what I just wrote in another thread. I hope this helps!

..............

 Ductless heat pumps can have up to 8 indoor units connected to 1 outdoor unit and are super efficient. I priced out what it would cost to zone out my personal home with a ductless system. For the outdoor unit, 6 indoor air handlers and other supplies (cable, copper,etc), it was over $7500 in supplies alone.

I installed a regular heat pump instead with a 20KW electric coil for emergency heat. That cost $1500. Now, I did the labor so that is why it was under $2000 for everything.

As far as a cost comparison between electric and gas, electric is WAY more. Over time, using natural gas will hands down save you every single month!!!

Example:

Heat is measured in BTU's

Electric baseboard or space heaters $35.13 / per 1,000,000 BTU's

Natural Gas                   $10.02 / per 1,000,000 BTU's

Heat Pump                    $14 / per 1,000,000 BTU's

It is 3.5 times as much multiplied by every month you are paying to heat the property.

Here is a free calculator offered on the Department of Energy's website:

http://www.eia.gov/tools/faqs/heatcalc.xls

I just wanted to make you aware of your options and any necessary information before taking on that monthly expense.

Also, with a central system, you control it (WiFi Stat). You will not have it set to 65 in the summer and 78 in the winter.

Lastly, gas line is very cheap to buy, black pipe is super cheap, but flexible gas line is super easy to run ( Gastite* or TracPipe* are the two main manufacturers). Do not let that deter you from paying 6 times more a month. Going from electric to gas alone will save you 350%, add in the fact you can control the heating and cooling from your smartphone for an extra $150, that could be another 300% savings.

I hope this helps,

Jonathan