Purchased solar systems can add to home value

Source: The Business Journal
Written by Chuck Harvey

Soaring electric costs have made solar roof panels an attractive way to cut energy costs during the sizzling hot San Joaquin Valley summer months. But solar systems can also add to the value of a home when it comes time to sell. “It can add 8-10 percent on to the value if you own the solar system,” said Ken Neufield, agent for London Properties in Fresno. However, if the system is being leased, it does not improve the value, he said. Also, when a solar system is leased, the homeowner does not receive solar credits or rebates. The solar leasing company does. Government tax credits can add up to $2,000 with rebates going even higher. They can save as much as 40 percent of the cost of the solar system. And the seller must remove the leased system or keep it in place and require the buyer to assume the lease. That could be a plus or a minus depending on whether the potential buyer liked the idea of leasing a system. A recent ad for a home in Selma included a description of a leased solar system that the buyer would be required to assume the lease on. The lease was $120 a month with 12 years remaining on the contract. The ad also pointed out that the system allowed the owner very low electric costs that averaged less than $50 a month in 2011. The fact that the system keeps electric costs down during the costly summer months could be an attractive selling point, at least to some buyers. But if improving the value of the home is part of the plan, then a purchased solar system would be the way to go. Also, research shows that a home solar system can pay for itself through added value when a home is sold. The U.S. department of Energy’s Lawrence Berkeley National Laboratory determined through an analysis of 72,000 California homes sold between 2000 and 2009 that the premium received on the value of the home more or less matched the initial capital investment in the solar system. The study also found that houses with solar panels installed sold at a premium of $17,000 more than similar houses with no solar panels. Besides going on roofs, systems are available that place solar panels in different locations near the home. Earth Wind & Solar, Inc. of Coarsegold offers photovoltaic solar products that attach to cabanas, overhangs called charging trees, fences and solar arches that also serve as shelter for a car. The products are known as the G-Mount product line. Earth Wind & Solar also provides more traditional systems for the roof ranging from 12 solar panels to 24 solar panels, priced from $9,936 to $19,875 installed. The company has also developed a “super size” panel system designed for homes with monthly bills of more than $300. The purchase includes equipment, installation, seven years of monitoring and maintenance and a performance guarantee. J. Scott Leonard, president and chief executive officer of Guarantee Real Estate in Fresno, said that solar systems generally add about half the value of the solar system to the current value of the home. Leonard had a solar system installed on his home in 2012 at a cost of about $34,000. “I love it,” Leonard said. But he said that if the house were sold, he would not be able to get the total cost of the solar system back. Still, he sees it as worth the cost. “It is of value to the environment and adds value to the home,” Leonard said. He added, “It will have a long-term payback to me.” It can be a great selling feature, Leonard said. “It adds value, but it is unlikely the seller will recover the entire cost,” he said. “And if you lease, it adds nothing to the value.” In terms of saving money on the cost of electricity, Leonard said the savings can be substantial. He said that his September bill, which came following a blazing hot month, was only $50. “I was very pleased,” Leonard said.

URL to original article: http://thebusinessjournal.com/news/real-estate/4848-purchased-solar-systems-can-add-to-home-value

For further information on Fresno Real Estate check: http://www.londonproperties.com