In a recent podcast I detailed our plans to build a passive house. Our reasons for doing so are:

1/. To cut down our environmental footprint by building a house that needs less heating and cooling;

2/. To save money over the long term. Sure, the build will have a higher up front cost but this will be our long term house and the heating and cooling savings alone will more than recover that;

3/. For our family to just be more comfortable in our own house;

4/. To remain as healthy as possible.

I could be wrong on some of these benefits as I am still learning a lot about passive housing, so I decided to reach out to someone who has built their own passive house and lived in it for almost 3 years now.

Take it away Ben….

Why build a passive house?

For nearly 6 years after the Christchurch earthquakes, my wife and I ended up renting in Auckland. What we learnt from renting was that these million dollar houses we lived in were poorly built, woefully maintained and uninsulated. At least while we rented, we were able to push our excess savings into the post-GFC stock market for some decent returns.

The first rental in Auckland was a 1950s villa which had no insulation and only an open fire for heating. It was the coldest we have ever been inside a house. We added some plug-in electric heaters but could only afford to run them in certain rooms and at certain times. $400 electric bills become the norm in winter, anything suede or leather was lost to mould and huge parts of the house were off-limits in winter due to the cold.

We moved on to a more modern 1990s house which had a heat pump and some token insulation. It also had large, drafty bi-fold north-facing door for some indoor-outdoor flow. It was bearably warm in winter but, come summer, the huge expanse of glass in direct sunlight made it a solar oven. The only way to cool down was to fling open the large bi-folds and let a thousand flies into the house per day. Even then, the upstairs bedrooms that our toddler and baby slept in would be 32 degrees when we put them to bed.

We never felt settled in Auckland and wanted to return south before the children started primary school. We had decided that we would build somewhere to remove any worry about potential earthquake damage or shoddy repairs. We then agreed on a 20+ year time horizon for the house based on the need to be in one place for schooling.

Is a passive house a good investment?

Once this was agreed it helped us focus on what was really important for our house. We were not interested in building as cheaply as possible and flicking it on in a few years. Once you have a longer investment period, you are within the payoff period of several upgrades such as solar, better insulation and improved glazing.

Being of analytical mind, I dove headfirst into energy efficiency and healthy housing research. There are a lot of different builders, scheme, tools and standards out there promising better homes but one stood out head and shoulders above the others: Passive House.

This was the only one which used an accurate scientific systems-based model to calculate energy usage, had the lowest energy use and was outcome-based. The other options were all input-based i.e. add this material/feature to get a better home. How much better? No-one could tell us.

With Passive House you are guaranteed outcomes: 20-25 degrees year round, ultra-low heating load, no mould, no drafts, no cold surfaces and the whole house stays the same temperature. The modelling tool, PHPP, is the key part: by using it you can work out exactly what is needed to achieve the outcomes.

Sounds great right? So how much does it cost per square metre? That’s a question I hear a lot but it’s actually the wrong question to ask. The better question is: how much more does it cost over a similar house built to code? This is about 10% of the build cost + $5k for the modelling and certification (technically optional but this is part of the QA process that guarantees the outcomes and allows you to call your house a Passive House).

However, the best question is: what is the total cost of ownership over xx years? Now you are thinking along the right financial lines.

The extra cost is paid back over time via cheaper energy bills. Everything in our house is electric and we pay about $300 per year for power, saving about $2100 per year vs the average NZ bill. This amount can buy you an extra $50k of mortgage at 3.5% over a 30 year repayment.

Remember that your build cost is fixed at the time you build whereas power prices will increase over time. After 30 years of 3% cost inflation, the $2100 saving would grow to $4,948. With these assumptions on a $500k build, the extra $55k is paid back just under 22 years. After that it is pure profit.

And remember that you have capitalised the build cost and will recoup it should you sell vs the operational cost of electricity which you will never get back. The other way to do it is to build 10% smaller. Get rid of that guest room that is only used a few days a year and spend the money on the quality of the building fabric instead. Less to furnish, maintain and clean too.

What are the benefits of a passive house?

Ok, so what benefits does this extra upfront cost buy me?

• Comfort. A lot of comfort - always warm, never too hot or cold, no drafts, constant fresh air. When I wake up, I have no idea what the weather is like outside and it’s always a perfect warm Spring day inside.

• Low bills – in the event of an extended cold spell, our whole house can be kept warm using 1200W – the same output as a hairdryer. This translates into very small bills.

• Carbon negative – the solar panels generate more than double our annual usage.

• Quiet – thicker insulated walls and triple glazing mean inside has Zen-like silence.

• Zero Condensation – windows are too warm for moisture to condense on. All moisture is extracted by the ventilation system. Clothes can be dried inside without any issues.

• Zero Mould – because the whole house remains warm and dry all the time, it is physically impossible for mould to grow.

• Healthy – We take less days off work/school sick than we used to. It’s also a wonderful place to convalesce should you get ill.

• Usability – the whole house stays at the same temperature so can be used year round. This will allow you to get away with a smaller footprint.

• Resilience - with thicker walls and plywood bracing, it is more earthquake resistant. The higher quality fabric will also last longer than a standard 50-year code design.

More information on passive houses

We have been in our house for 3 winters and 2 summers and it has performed exactly as the model predicted. It just works. The worries about our housing being too hot, too cold, too expensive to run or unhealthy have disappeared. We have already decided that any house we live in from here on forwards would need to be a Passive House – we could never go back.

How did it affect our FI (Financial Independence) journey? We ended up spending a bit more on the house than originally planned which has added less than 2 years to our FI horizon. There will a net financial benefit over the long-term but it’s the harder to measure benefits that really make it a great investment. It will also be a great place to spend more time in once retired and cheap to run.

If you want to know more about our house, you can follow us at facebook.com/ChchPassiveHouse. For those of you near Christchurch, we also do a Passive House Open day every June when you can experience one first-hand and I can answer all your questions.

Nick’s final comments: Thanks very much Ben for sharing your experiences. Sounds like it has been a great decision for you and the family even if it has delayed your time to financial independence. After all, we have to enjoy the journey. And $300 a year for electricity for a family of 4!

Do check out Ben’s Facebook page. He documented his building journey as well as some detailed posts on running costs.