Adding Solar Increases Home Value
Did you know that installing solar increases home value and can potentially improve your family’s financial position? Not only can solar reduce or eliminate your electric bill, but it is almost always a good real estate investment. This one improvement may contribute to increasing home values by 3 to 4 percent! The combined benefit of higher resale value and lifetime energy savings makes solar a compelling financial investment.
One study by Lawrence Berkeley National Laboratory analyzed the sale of nearly 4,000 homes with solar in eight states. The study determined that some buyers, particularly those in California, are willing to pay a premium. Some are willing to pay $12,000-$15,000 more for a solar home. This illustrates how important it is for buyers and sellers to familiarize themselves with how solar affects property values.
States like California have over the past decade enjoyed a booming solar industry. Since the solar real estate market is more mature, agents, lenders, and appraisers are more likely to understand its value. In those states, there are plenty of comparable home sales that can guide accurate pricing decisions. Other regions are still learning the benefits of solar. Renee Baker, an agent in Las Cruces, New Mexico, said about six years ago, many local real estate professionals did not understand how solar increases home value.
“The problem was that a lot of them didn’t know what they didn’t know,” Baker said.
Solar Energy Industries Association Data
But that has changed as more solar houses go on the market. The Solar Energy Industries Association (SEIA) report there are more than 1.5 million residential solar systems in the U.S. The amazing fact is a new home goes solar roughly every 90 seconds. Real estate professionals nationwide are beginning to gain experience with marketing the solar features of a house. There are also now better tools and training to help with solar real estate deals. These include third-party groups that calculate the current and potential value of a solar system.
SunPro Solar home solar systems are more powerful, more efficient and degrade at a slower rate than conventional solar. As a result, SunPower systems generate up to 60 percent more energy over their first 25 years. SunPower systems are well-positioned to add additional value to your home. Moreover, SunPower has the strongest combined product and power warranty in solar. A Savenia Labs blog noted there’s a relationship between a comprehensive warranty and higher resale values.
Best Way To Assess Solar Home Values
Real estate agent Baker said as local solar home markets mature, real estate agents are able to lookup more comps. They are the best way to assess the value of any house, solar or otherwise.
Baker, who has handled about 16 solar home sales, said prospective home buyers have two major concerns. Homebuyers want to be sure there’s documentation their installation was done properly. This is information any reputable solar dealer will provide. They also want proof the system is saving money on electric bills.
“So, if you’ve got that documentation, you can show that,” Baker said. “You can show what the electric bills look like, and that’s the proof in the pudding.”
Using this “income approach” is recommended by the recent SEIA report, “How Owning a Solar System Impacts My Home Value: A Guide to Valuing Residential Solar Energy Systems.”
It spells out the various methods for assessing the value of solar homes and explains why the income approach provides the most accurate view for prospective buyers.
The report also provides several resources, including solar calculators, and lists organizations that can help solar homeowners. The report is updated periodically with additional tools as the U.S. solar market continues to grow and become a more integral part of the country’s real estate landscape.
Contact SunPro Solar or call us today at 951-678-7733 to speak with an experienced energy consultant.