Analyzing the Cost of Insulating a Home with Spray Foam

Originally published by: Design & Construction WeekMay 24, 2017

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Often constricted by tight construction budgets, high volume residential builders typically choose to work with materials that are cheaper or have always been used. When it comes to insulation, there is a misperception that the cost of spray foam insulation in a whole home is too expensive leading builders to revert to the tradition insulation options. However, the insulation cost difference between spray foam insulation and traditional batt insulation is narrowing. Depending on the building code in your state, together with a range of cost offsets, the insulation cost for spray foam can be within reach for inclusion into new home construction.

Savvy new home buyers who have done some initial research and are attracted to the benefits that spray foam insulation offers may ask “What is the cost of spray foam insulation for my whole home?” With quality, performance and reputation playing an important role in all of our purchases big or small, the initial cost versus the advantages and the return-on-investment can play a significant role. 

According to popular homeowner website, HomeAdvisor, the average cost for traditional batt insulation is around $1552.  What about spray foam insulation? The average can range between $4500-$5000 for spray foam insulation – see the example below.  In average terms, the spray foam insulation cost for a whole home can vary between $0.44 to $0.65 per board foot for open cell spray foam insulation, and between $1.00 to $1.50 per board foot for closed cell foam. There are, of course, a number of variables that can impact the initial investment of spray foam insulation. These typically include:

  • Labor
  • Quantity of material required
  • Type of material required or specified (i.e. open cell spray foam or closed cell spray foam)
  • Project location
  • Building code requirements
  • Project size

How is the price between traditional insulation and spray foam narrowing?

Although the initial investment of spray foam insulation is higher than more traditional insulation types such as fiberglass, there are cost saving opportunities that high volume residential builders can capture. These can include right-sizing HVAC equipment, eliminating the requirement for specific vents, eliminating energy heel trusses and eliminating wind wash baffles, among other opportunities.  

The various potential cost offsets for spray foam insulation can vary state by state but may contribute to as much as $5,000 depending on each state’s building code requirements. When factoring in building code, Energy Star potential cost saving opportunities as well as the aforementioned eliminated items, the insulation cost gap between traditional insulation and spray foam insulation can mean that spray foam is not as expensive as you think.

What is the ROI for a whole home insulated with spray foam insulation?

Savings are not only for the builder. With spray foam insulation included into a new home build, homeowners are able to pay back the initial investment within three to four years on average*. Below is an example of the potential ROI (return on investment) for a 2,000 sq. ft home in climate zone 5. This climate zone includes areas such as Oregon, Nevada, parts of Illinois, Ohio, Massachusetts and parts of New York, so the following example offers a good sense of the ROI potential for homeowners. A full climate zone map can be accessed here.

Cost to Install Icynene Spray Foam Insulation:  $ 4,500 

subtract: the price to insulate with fiberous material  $ 1,800

subtract: the savings from HVAC right-sizing due to Icynene  $ 500

subtract: cost of air sealing, Lesco boxes, extra caulk/tape, etc  $ 400

Incremental net cost increase  $ 1,800 [A]

Savings Generated:

cost to heat and cool the home per year with fiberglass  $ 1,977

subtract: cost to heat and cool the home per year with Icynene  $ 1,248

savings per year using Icynene   $ 729

Savings per month  $ 61 [B]

Cost to home buyer of financing the Icynene upgrade

Example:  Rate: 4%

Term:  30 yrs.

Cost to finance per month $1,800 from [A]  $ 9 [C]

Monthly Savings due to Icynene Insulation [B subtract C]  $ 52

Yearly Savings due to Icynene Insulation  $624

The ROI for installing spray foam insulation can be varied between each home design. A small 1,500 sq. ft. home in New Mexico may see estimated $489 in annual savings* while a larger 4,750 sq. ft. home in Missouri may see estimated annual savings of up to $1,525. Again, it will vary between state, home and other variables.

While the cost of spray foam insulation can vary dependent on a variety of factors, high volume builders can start to see that together with potential cost offsets during construction, the cost for foam insulation like Icynene is not as expensive as was once thought.