Homeowners have traditionally been encouraged to think of their property as an investment because of its potential to increase in value. Today, there’s another reason to invest in your home – it could reduce your monthly expenses.
Faced with electricity prices that have increased by between 8.76% and 9% this year, rising municipal charges, and salaries that have not kept pace with inflation, homeowners could free up some hard-earned cash by making their homes more efficient.
Relatively simple upgrades such as making the home more energy-efficient, replacing ageing appliances, installing solar panels, rainwater-harvesting tanks or greywater systems can all help save money and add to property value.
According to financial services provider DirectAxis, carefully planned home improvements can pay dividends long after the initial investment.
“Consider that electricity, water, and municipal charges are recurring expenses that typically rise faster than inflation and continue long after you have repaid your bond. Home improvements that reduce these monthly expenses can contribute to long-term financial resilience. Think of it this way: every rand you don’t spend is a rand you keep,” explains DirectAxis Product Head, Gavyn Letley.
He says home renovations are the leading reason DirectAxis’s 1.3 million clients give when applying for a loan.
When making the financial case for home improvements to reduce household expenses, consider the costs and the potential savings. In some cases, small changes can make a big difference.
In South African homes, the geyser usually uses the most electricity. Eskom estimates that it accounts for about 40% of a typical household’s consumption. Insulating the geyser and hot water pipes and installing a timer will deliver daily savings. Upgrading to a heat pump or solar water heater is more costly but can offer greater savings in homes that use a lot of hot water.
One of the simplest ways to cut electricity consumption is to install LED lighting. The upfront cost is relatively low, installation is straightforward, and the savings begin immediately.
Older refrigerators, freezers, washing machines and tumble dryers often use substantially more power than modern, energy-efficient models. Some of these appliances run daily, so the cumulative savings can be significant over time.
Solar PV can dramatically reduce grid purchases, particularly when done in conjunction with household power-saving measures. The return on investment continues to improve as electricity tariffs rise.
Greywater systems, rainwater harvesting, leak repairs and efficient plumbing fixtures reduce water consumption and provide increased savings as municipal tariffs rise. These improvements also reduce reliance on municipal infrastructure and provide resilience during drought and water restrictions.
“When considering ways to save on household costs, think about these three things: use less by being more efficient, waste less by better managing energy and water, and generate more of your own by installing renewable technologies or even investing in a borehole,” says Letley.
He says it is important to make informed decisions and ensure the numbers work before committing.
Calculate the likely savings compared to the cost to ensure the investment makes sense. Most simple improvements can be financed from the monthly household budget. If you are considering financing for solar PV or similar larger projects, work out how long these will take to pay for themselves, including interest and administration costs, a realistic payback period and repayments that will not stress the household budget.
The table below indicates how to do this:
| Improvement | Typical upfront cost[1] | Potential payback |
| LED lighting | R500 – R5 000 | Usually 6 – 24 months |
| Geyser blanket and pipe insulation | R700 – R2 000 | 1 – 3 years |
| Heat pump | R18 000 – R35 000 | 3 – 6 years |
| Solar water heater | R20 000 – R45 000 | 3 – 6 years |
| Energy-efficient refrigerator/ freezer | R8 000 – R25 000 | 4 – 8 years |
| Ceiling insulation | R10 000- R40 000 | 4 – 8 years |
| Solar PV with battery | R80 000 – R250 000 | 6 – 12 years |
| Greywater recycling system | R8 000 – R40 000 | 4 – 10 years |
| Rainwater harvesting tanks | R8 000 – R40 000 | 5 – 12 years |
| Water-efficient taps, showerheads and dual-flush toilets | R1000 – R10 000 | 1 – 5 years |
“Every household’s circumstances are different, but the principle is the same: reducing recurring expenses while adding to the value of your property can help build a more efficient home and a stronger financial future,” says Letley.
[1] Costs and payback are based on: typical retail and installation costs in the South African residential market (2025–2026); published guidance from Eskom, energy-efficiency programmes and installers; industry estimates of energy savings; and typical payback calculations using current South African electricity tariffs.
