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Solar Panel Fires
- Thread starter GromsDad
- Start date
I'd be reluctant to buy a house with a 5 or 10 year old solar system. I'd be worried I was buying someone's expensive headache.GDaddy said:
Meh, parts is parts. Whether or not the roof is good enough to go the distance would be a bigger factor.GromsDad said:
But as far as the resale value of those systems, let's say the actual consumption part of your electric bill averaged $200/month. How much extra would you pay for the home that only cost you $25 or $50 per month in consumption? It's worth something, but probably not $15k. And even that $15k adds to your monthly payments unless you pay it up front in cash (and forego the other potential uses for that cash).
Opportunity cost is a thing, and the solar salesmen never touch on it in their power point presentations.
As I'm sure you're aware, all I do in my day job is analyze various types of real property transactions for value. I research and analyze more sales and rental transactions specifically for their value influences in a week than the average agent or broker does in a year.
And although people might think that spending X on an item will have a commensurate return on value in the resale market that is only sometimes the case.
In general, PV solar installs is an explicit example of a feature that never or almost never returns its full costs in the resales. There are rare exceptions, such as (sometimes) when the solar is added during the initial construction of an entire subdivision or condo project, but even with those it's not always the case.
The buyers probably *shouldn't* be acting that way about solar, but opining on what I think should or shouldn't be is specifically not my job. My job is to observe/report what actually *is* happening with these transactions.
I'm working on a small subdivision project (new construction of entry level homes) right now where the solar is being added into the construction - so every unit has it. As part of my research and because I have to show my work on it, I have located competing projects for comparison that represent both the have and have not condition. And among those two datasets there's no discernible difference in value. So in that area and that price range not even the new construction demonstrates the full return of PV solar costs when compared to the projects that lack that feature.
I make no assumptions about these rule of thumb situations - when they're present I always have to ask the question and find the answer in the market. And so far in most datasets I see, the price increase attributable to an owned-solar install is neglligible in relation to the overall values if its even present at all. Certainly nowhere near their respective costs.
Now when I say "no discernible differences" I'm talking about the central trend in those datasets. There are a few buyers who will pay full price for the solar but those are outliers and are not indicative of what the herd is doing.
Speaking personally, I'd pay a little more for solar if a property I was buying had it, but I would not pay more than about 20% to 25% of the cost of the install because I own a financial calculator and I know how to use it. I understand that saving $50 or $100/month in electricity has only limited value to me.
And although people might think that spending X on an item will have a commensurate return on value in the resale market that is only sometimes the case.
In general, PV solar installs is an explicit example of a feature that never or almost never returns its full costs in the resales. There are rare exceptions, such as (sometimes) when the solar is added during the initial construction of an entire subdivision or condo project, but even with those it's not always the case.
The buyers probably *shouldn't* be acting that way about solar, but opining on what I think should or shouldn't be is specifically not my job. My job is to observe/report what actually *is* happening with these transactions.
I'm working on a small subdivision project (new construction of entry level homes) right now where the solar is being added into the construction - so every unit has it. As part of my research and because I have to show my work on it, I have located competing projects for comparison that represent both the have and have not condition. And among those two datasets there's no discernible difference in value. So in that area and that price range not even the new construction demonstrates the full return of PV solar costs when compared to the projects that lack that feature.
I make no assumptions about these rule of thumb situations - when they're present I always have to ask the question and find the answer in the market. And so far in most datasets I see, the price increase attributable to an owned-solar install is neglligible in relation to the overall values if its even present at all. Certainly nowhere near their respective costs.
Now when I say "no discernible differences" I'm talking about the central trend in those datasets. There are a few buyers who will pay full price for the solar but those are outliers and are not indicative of what the herd is doing.
Speaking personally, I'd pay a little more for solar if a property I was buying had it, but I would not pay more than about 20% to 25% of the cost of the install because I own a financial calculator and I know how to use it. I understand that saving $50 or $100/month in electricity has only limited value to me.
Thanks for breakdown. I appreciate the analysis. It's something my wife and I have thought about, especially in the summer months. We are pretty conservative with the A/C but still runs up to $300/400 a month. If we let it rip, would be closer to $500-$600/month. The outlay costs are what gave us some pause.
Good to know regarding resale value of solar panel installations. I was curious about that. Swapping out carpet (kids have savaged it) for hardwood floors and redoing kitchen counters, sink, appliances, etc. has a pretty tangible impact on current satisfaction along with future resale value.
Good to know regarding resale value of solar panel installations. I was curious about that. Swapping out carpet (kids have savaged it) for hardwood floors and redoing kitchen counters, sink, appliances, etc. has a pretty tangible impact on current satisfaction along with future resale value.
Unlike any other property type, homes scratch an emotional itch for most people so those factors really are significant to their values. That being the case there's nothing wrong with doing improvements that appeal to you and for your own satisfaction so long as you understand what you're getting into WRT the costs vs returns.
If you're looking at $400/month electric bills then pending $200/month to buy a $25k install might make more sense to you in a long term hold situation. But I probably wouldn't do it unless you're planning on being there for at least another 10 years.
If you're looking at $400/month electric bills then pending $200/month to buy a $25k install might make more sense to you in a long term hold situation. But I probably wouldn't do it unless you're planning on being there for at least another 10 years.
Cost vs. return is a big one. Especially if there are subsidies involved with the installation. Swapping out our front lawn with artificial grass (the good kind) was worth every penny and also saved on the PITA of mowing it every week or so. Although the rabbits still poo on it.GDaddy said:
We live in an incredibly good school district and it's a great family neighborhood so inclined to stay. More inland (and hotter) than I'd like but still within 20 minutes of beach, 30 to ones I like. So yeah, we'll probably stay a while. A lot of our neighbors have installed solar so thought is there.
Around here seagulls just love solar panels. They think they are a hard surface they can use to smash clams open on so they will fly 30 or 40 feet above and drop a clam on them. Not so good for the solar panels and not as effective as the sidewalk for opening clams either.
I want solar panels powering a space heater that warms a bathtub with a pitbull in it. I will pledge allegiance to Abu Bakr Al-Bagdadi, and haul my erBB flamethrower to destroy the armies of Gog and Magog. At RJs or State Beach or Slime Harbor.
Better hope they don't inadvertently drop one on your clam opener or every surf check will be shock and awe.GromsDad said:
A couple of the big solar farms out in the desert have reportedly been shut down or throttled way back because of their bycatch. I guess there's a limit to the number of eagles and hawks they're allowed to microwave in mid-flight.
Another problem with tying the big solar operators into the grid is that they're not scalable - when the sun is out they're producing whether you need that much capacity or not and that power has to go somewhere. They're not like a NG fired power plant that you can dial up or dial down or shut down depending on demand. I reckon the power operators will figure that out over time, though.
Another problem with tying the big solar operators into the grid is that they're not scalable - when the sun is out they're producing whether you need that much capacity or not and that power has to go somewhere. They're not like a NG fired power plant that you can dial up or dial down or shut down depending on demand. I reckon the power operators will figure that out over time, though.
