Does solar increase a home’s value?

There’s three ways to value a house: 1) Assessed value - the value a local government places on your house for tax purposes, 2) appraised value - the value a bank assigns to a home, and 3) market value - the value a buyer assigns to a home. Sometimes these three values align, other times they do not. For the purpose of this video I am focusing on market value since I have access to Colorado data as a Denver real estate agent. It’s helpful to know that Colorado gets a lot of sunshine. Depending on who you talk to, there’s somewhere around 300 days of sunshine in the Denver area. The question I hope to address is how much market value does solar provide to a home, if any at all? Disclaimer: It’s important to note that not all real estate markets are the same. The benefit of solar can vary from region to region and this video should only be used as one example. If you need a recommendation for a trusted agent in your area who understands solar please let me know and I’d be happy to make an introduction. In order to determine if solar provides any market value lift I will add some controls, so I’ll break the analysis into three categories: 1) $1m+, 2) $500K-$999K, and 3) $499K-. I’ll do this again by taking the median above ground square footage and using this as my baseline for each price range. I’m also only looking at detached single family homes. If you have solar: $499K-: Sold price: $20,500K or 5.4% more CDOM: 12 days slower $500K-$999K: Sold price: $115,500 or 22.21% more CDOM: 2 days quicker $1m+: Sold price: $565,000 or 43.30% more CDOM: 17 days faster It’s hard to attribute these numbers directly to solar because it does not account for things like finishes of the interior and neighborhood - two factors that buyers typically prioritize. However, it is a really good indicator that solar does not reduce value of a home. There is one other important factor to consider, and that is how much solar off-sets your electricity bill. How much it reduces your bill depends on how large your solar panel system is, and probably more importantly, how much electricity you consume on a monthly and annual basis. If you own an EV, off-setting your electricity cost could be very important to you from a monetary perspective. Every dollar you’re not paying in electricity means a dollar you’re not spending powering your vehicle. Let me state this another way to underscore my point: If there was a way you could own a vehicle and never have to pay for fuel again or oil changes again, would you do it? How much money do you spend on a monthly basis to power your gas powered vehicle? This can have a monetary impact as well if you own solar and an EV. Four things to keep in mind: If you have financed or leased your solar this could work to your disadvantage when you go to sell it. If you intend on transferring the remaining balance on the solar to the buyer, this could impact your pool of buyers as some may not want to assume that loan balance or lease timeline and If a buyer’s debt to income ratio is really high and they are financing the majority of the purchase of the house, the added monthly payment for the solar may push the buyers above an allowable DTI from their lender if you can pay off the loan either before you put the house on the market or by closing, this will give you a far greater pool of buyers, and finally make sure your listing agent knows how to market a property with solar. I see too many homes with solar that do not have aerial photos of the roof and don’t know how to quantify the monetary savings of solar in a listing description. I hope you found this video helpful. If you did please give it a like and share. ****************** Become a Patreon supporter: https://www.patreon.com/seanmmitchell Like Tesla: http://www.youtube.com/LikeTesla Now You Know: https://www.youtube.com/nowyouknowchannel Hyperchange: TV https://www.youtube.com/hyperchangetv Teslanomics: https://www.youtube.com/channel/UCbEbf0-PoSuHD0TgMbxomDg Products I use: Canon 80D: https://www.amazon.com/dp/B01H8CWRBM/ref=cm_sw_r_tw_dp_U_x_XHYIBb4RC08QH JOBY GorillaPod 3K Kit. Compact Tripod 3K Stand and Ballhead 3K for Compact Mirrorless Cameras or Devices up to 3K (6.6lbs). Black/Charcoal: https://www.amazon.com/gp/product/B074WC9YKL/ref=oh_aui_detailpage_o06_s01?ie=UTF8&psc=1 Rode VMGO Video Mic GO Lightweight On-Camera Microphone Super-Cardioid: https://www.amazon.com/Rode-VMGO-Lightweight-Microphone-Super-Cardioid/dp/B00GQDORA4/ref=sr_1_3?s=electronics&ie=UTF8&qid=1537461907&sr=1-3&keywords=rode+microphone Michelin X-Ice Xi3 Winter Radial Tire - 245/45R19/XL 102H: http://amzn.to/2DyiHUc iOttie Easy One Touch 4: http://amzn.to/2Bs3SR6 KobraTech Mini Cell Phone Tripod: http://amzn.to/2sJMOH2 #Solar #RealEstate #Renewables