Buying House With Solar Installed

[azdave]

Well, if I have to be honest, it sounds like a great deal...

Well, the OP hasn't been active here in over three years so he probably won't be getting back to you on that but who knows?

[Mike90250]

Selling a home with solar panels revolves around the homeowner, being able to explain the advantages to the Realtor, who explains it to the prospective Buyer. Like when swimming pools were only for rich people. The heating, cleaning, chemicals, insurance,,,,

[J.P.M.]

So basically the general consensus is that if you do not plan on staying in your home for a long time, or at least long enough to get all of your money back from the PV system, don't bother to get it. Just saying cause I am about to go solar, and I am not sure how long I will stay here given these NJ property taxes. I think a fair guess would be at least 5 years. Sure can be 20+ for all I know, but nobody ever knows.

Far from a general consensus. Opinions in the other direction are probably just as prevalent although I believe generally less than well informed. Depending on how you run the numbers and what your choices are, not bothering w/ PV is one possibility that may be among the cost effective options. If the goal is the lowest long term way to provide electricity to a dwelling, PV is generally not part of the least expensive mix of options, but that varies a fair amount. Expensive POCO power, guaranteed low maint., SRECS and a low LCOE for solar (which, if folks are informed and are truly honest and realistic about assumptions, usually requires a longer lifecycle time than most folks may own a PV system) relative to POCO power costs might be seen as advantages to solar. You gotta run the numbers. Every situation and lifestyle choice is different. Unfortunately, ignorance seems abundant.

[desant89]

So basically the general consensus is that if you do not plan on staying in your home for a long time, or at least long enough to get all of your money back from the PV system, don't bother to get it. Just saying cause I am about to go solar, and I am not sure how long I will stay here given these NJ property taxes. I think a fair guess would be at least 5 years. Sure can be 20+ for all I know, but nobody ever knows.

[J.P.M.]

The big difference between an old Hot Water system and an old PV system is an old hot water system usually leaks down and is pretty well inert. A PV system on the other hand could have 500 volts DC looking to go to ground. I have been asked to look at orphaned systems over the years and I usually decline. Inevitably the new owners have called multiple electricians and no one would go near an orphaned system. it all comes down to they don't think the risk is worth the reward for working on it. Usually they get some "solar specialist" who convinces them to rip down what's there and put in new.

I expect that in the long term there is going to be an service issue with all these solar systems installed by the lowest bidder and I really am not sure if there is much or repair infrastructure out there. Add in the rapid change in technology and expect there will be many orphaned systems. I have a "state of the art" (when it was installed) grid tied array in operation, it consists of four 160 watt panels, two pairs of series wired panels connected in parallel to a 1 KW grid tied inverter. When it dies, whose going to have clue how to fix it? Even if they had a clue, where would they get an inverter? I expect I will just rewire the panels in series and see if I can get a microinverter to work.but expect most pros will offer to remove them for a price.

Thank you.

Seems to me that your comments about serviceability or what sounds like the current lack of it for orphaned systems would add to much weight to the argument that an existing PV system adds to the value of a property.

Tear it off and do it again doesn't sound either pleasant or cost effective for a potential buyer.

As for a business opp. for array repair: Maybe similar to TV repair or other electronic devices - mostly non existent except what amounts to scrap and replace w/new.

I would comment, however, that your post offers something for those looking to install PV at their residence to consider in that there is a sometimes/perhaps an unmentioned and perhaps unconsidered advantage of using quality, established electrical contractors: They were around before PV, and because that's not their only source of income, the probability may be higher that they'll be around after solar peaks to service their customers, or at least higher than that of the big national bottom feeding outfits or the local in/out losers being around to service their customers.

[peakbagger]

The big difference between an old Hot Water system and an old PV system is an old hot water system usually leaks down and is pretty well inert. A PV system on the other hand could have 500 volts DC looking to go to ground. I have been asked to look at orphaned systems over the years and I usually decline. Inevitably the new owners have called multiple electricians and no one would go near an orphaned system. it all comes down to they don't think the risk is worth the reward for working on it. Usually they get some "solar specialist" who convinces them to rip down what's there and put in new.

I expect that in the long term there is going to be an service issue with all these solar systems installed by the lowest bidder and I really am not sure if there is much or repair infrastructure out there. Add in the rapid change in technology and expect there will be many orphaned systems. I have a "state of the art" (when it was installed) grid tied array in operation, it consists of four 160 watt panels, two pairs of series wired panels connected in parallel to a 1 KW grid tied inverter. When it dies, whose going to have clue how to fix it? Even if they had a clue, where would they get an inverter? I expect I will just rewire the panels in series and see if I can get a microinverter to work.but expect most pros will offer to remove them for a price.

[J.P.M.]

If you are covering 95+% of you electric bill, and can prove it, nobody can say it has no value.

Proof is a slippery concept. In a simple sense, if a system's current annual savings can be documented and it's added value can be ascertained from that, then some value can be ascribed.

But that takes no account of the cost of maint. and a value to the risk that the system will cause more problems that may be more costly than the savings, or that future value on a resale may be negatively impacted by a system's presence. I can think of several scenarios where someone might be of the opinion that an existing PV system has no added value, or even negative value. One of several might be:

Aesthetics and potential problems over time from poor installation. There are a fair amount of derelict solar water heater in my HOA. They look abandoned. Owners usually are clueless if the systems are even working, or actually, believe it or not, wasting more energy than they might produce. Hard to say in a quantitative sense what that does to a home's marketability. Neighbors seem to think it detracts from the value of the neighborhood and hence their home's, value. To my observation, folks often and usually tend to be funny about stuff like that.

Now, think 5 -10 tears down the road, and think about a PV system that's 10 years old, covers 4-6 times or more of the area of a water heater, with a bunch of roof penetrations and all installed by Larry with a ladder, or perhaps worse, the homeowner, for lowest initial cost and no roof maintenance done at install. Besides what it may look like, what would a reasonable person think ? Is the lower bill worth the (probably incompletely) known risk ? Oh, and production has rolled off from normal aging and (also) the array has not being maintained any better than the water heater situation described.

Thinking that today's system will add value to a home in the future simply because it produces savings off a bill, and solar is today's media and peddler produced darling, and is looking and performing like new seems shortsighted to me.

Unless you are the homeowner and know what you're buying, any current PV system is a pig in a poke. I suppose the same can be said about every home's mechanical add ons and equipment like appliances, plumbing and such, but PV usually costs a lot more, and, being on a roof, can lead to more problems than say, for example, if a garage door opener goes south. Even if knowledgeable, a potential buyer does not know if an existing system was properly and professionally installed such that it will off set any potential price premium - that is , produce annual savings as claimed, and do so for a period long enough to equal or exceed the asking premium, which is a real sketchy number anyway. Additionally, will it do so while not causing maintenance or worse problems.

A couple of reasons why I'd not buy a home with an existing PV system, and, separately why, in IMO only, PV, as a general housing market feature only adds value to a property to the extent of buyer's ignorance and the seller's or seller's agent's ability to hype a product.

[J.P.M.]

The guy you were replying to seemed to be talking about actual value of solar, and you were talking about something much bigger and more general; I wasn't sure he noticed, so I tried to clarify.

Give it a rest Dan. Crawl back in your hole.

But, before that, take a lesson and know that some of us have the common sense to know that what we write is usually read by more folks than just the one being responded. I suspect most of us are aware of a more general broadcast.

Besides, where do you come off being so arrogant that you assume people are so mentally slow that they don't understand what's written by others and need your salient insights to make the world clear to them ? Or, that they may care what I, or anyone for that matter anyone, may write in the first place ?

What smug hubris.

[Ian S]

The system was installed the end of 2012. Per the permit, it is a 3.2 KW system with 28 65"x39" panels. The specific inverter and brands I am unsure of, but would tend to think Sungevity was not using top of the line items. I have spoken with the utility company and they say it looks as if the system is trying to cover the amount of energy needed during the peak hours. The house is still averaging an energy bill of $165/month. The utility company said they thought it was a 6.0 KW system. Per the contract with Sungevity the system was estimated to produce 8,196 kWh/year for the first year and 7,462 kWh/year over the term of the lease. Running this numbers this is assuming a 1% decline per year in efficiency.

We are located in the Phoenix metro area. I know there are many variables, but a range is more than fine. What would I be looking at total cost if I was going to put of a 3.2 KW system? What about 6.0 KW?

Something is strange about the numbers. If there really are 28 panels, then a 3.2 kW system would mean that each panel is only rated at 114 watts. More likely a panel of that vintage would be around 210-220 watts so that would make it closer to a 6kW system. But here in Phoenix, unless you have serious shading issues, a 6kW system should generate considerably more than 8,000 kWh/year. My 6.9 kW system installed in 2012 generates over 12,000 kWh. So, you really need to nail down the details of what this system is comprised.

Also to keep in mind is that a new solar system in Arizona is not likely to be cost-effective due to the new rules already in place for SRP and all but a done deal for APS. So an existing presumably grandfathered system may have a clear advantage in that case but only if you actually want solar. If it were me, I'd nail down the details of the system components and wattage. I'd then insist that the seller buy out the lease; what kind of help you'd offer, if any, would be up to you. FWIW, it sounds like the home has not been priced for a quick sale.

Back in 2011, I got a quote from Sungevity for a system using BP Solar panels and a Kaco Blueplanet inverter.

Good luck!

[Wy_White_Wolf]

Are the labor warranties not transferable? I am sure the manufacturers parts warranties all remain in effect either way. With no warranty, I totally agree with the a max of 50% value.

I believe it takes the original owner or installer to do the transfer. I don't see Sungevity doing that.

[desant89]

Also consider a new system will have a warrantee and installer to repair any problems that may come up. To me that would reduce the value of a used to system to no more than 1/2 of the cost of a new system. Also depreciation. Their lease is for 20 years so I'd use that. Deduct 5% for every year it has been in use.

WWW

Are the labor warranties not transferable? I am sure the manufacturers parts warranties all remain in effect either way. With no warranty, I totally agree with the a max of 50% value.

[Wy_White_Wolf]

Also consider a new system will have a warrantee and installer to repair any problems that may come up. To me that would reduce the value of a used to system to no more than 1/2 of the cost of a new system. Also depreciation. Their lease is for 20 years so I'd use that. Deduct 5% for every year it has been in use.

WWW

[J.P.M.]

As a buyer, I have no specific feelings about solar as I look at purely in a financial sense. If the seller can prove he is saving say $100/month on his bill and he thinks the system is worth an extra $10,000 to the house, in effect I would be prepaying 8 years of my energy cost. If I think I may only be in the house 7 years (depending on the report, the national average) I will never break even.

I do agree with usage and how this can affect the numbers.

It's all about perceptions. And for the peddlers of the world, creating and changing the sheeple's perceptions and priorities. Who ever thought a black monolithic slab on a roof could be turned into a thing of beauty ? Non or poorly educated sheeple make the best customers. Folks who are not mentally slothful with common sense and good education are the bane of con men.

[desant89]

I agree also. I guess my usage is a lot different. I am getting a 12.4k system, but have 5 people, a pool, hot tub etc. Given that, I expect to save 250+ a month on my bill. Then of course we get into SRECS. I hear you may, or may not transfer the SRECS when you move (another consideration for a buyer if they will get the SRECS). That's a whole other discussion. So what I am saying is that in my situation, if I see a home has solar, and is generating 15k a year, it would be a hugs savings for me knowing that I use that much. Being used, I would think the system should be worth 15k to a buyer in five years (37k new). But, I do agree with J.P.M, I think a home having solar will hinder the sale as everyone would buy a home without Solar, and not all would buy one with it.

[Hansel07]

As a buyer, I have no specific feelings about solar as I look at purely in a financial sense. If the seller can prove he is saving say $100/month on his bill and he thinks the system is worth an extra $10,000 to the house, in effect I would be prepaying 8 years of my energy cost. If I think I may only be in the house 7 years (depending on the report, the national average) I will never break even.

I do agree with usage and how this can affect the numbers.