Even before the pandemic homeowners like you already have a list of home improvements they want to make in their homes. But due to the recent increase in electricity bills because of a quarantine set-up — or you want to decrease your carbon footprint consumption — you may have considered adding renewable energy such as solar panels to that list. And as a homeowner, you need to be smart with your decisions and need to think long-term before making a large financial investment in your home.
So now you’re here because you’re wondering if you’re going to get your money’s worth upon installing solar panels for your home.
We know that solar isn’t that cheap, but it is if you consider its warranty and longevity.
The Department of Industry, Science, Energy, and Resources says that a solar energy system will likely increase your home’s value, and as of December 31, 2020, more than 2.66 million rooftop solar power systems have been installed across Australia.
But an experienced agent says that in his experience dealing with buyers the truth is a bit blurry. He says that it differs. Some people value solar, but it’s on a case-by-case basis.
The explanation, according to the agent, is that homeowners do not own the solar systems built in their homes in certain circumstances. “A seller may have ownership of the solar equipment outright.” he explains, “but in other instances, they may be interested in a lease where the equipment is owned by a third party. The vendor could have bought the equipment with a loan in some cases. ” This will cause a lien on the property.
He has seen customers shy away from solar homes in the latter of the two cases because they didn’t like that kind of arrangement. At the end of the day, not everyone sees solar as important, but there is a market (that is slowly growing) that believes it to be precious.
Now let’s look into a couple of factors that change the relationship between solar and home sale prices:
The Age of your PV System
If you installed your solar power system in 1995, you can’t expect to garner as much home value as a photovoltaic system installed in 2021. Solar modules are far more efficient than they used to be, and the newer they are the more valuable it.
Types of solar panels and systems
There are two types of solar panels and systems on the market today. A silicon screen, which comes in two forms: monocrystalline and polycrystalline, is the first kind of solar panel. Both forms behave equally, according to SolarReviews.com. While monocrystalline panels have been around the longest, polycrystalline panels are more commonly used today. Silicon panels are the most efficient panel on the market, ranging from about 18% to 22% efficiency.
A thin-film solar panel is the other form of a panel that you can select for your house and is commonly found on products like solar shingles or solar tiles. They’re less expensive to produce, but also tend to be less efficient (with around 11% to 13% efficiency), which can affect how much energy the panels will generate.
You also have two choices when you install a solar system in your home. You could link your system to the local grid of electricity (the most common and least expensive because they require less expensive equipment and maintenance), selling back to the power provider the surplus energy you produce. When the sun is unavailable, you can get electricity from the grid to supply your needs, therefore it eliminates the extra expense on electricity storage devices, such as batteries.
Or, you can install an off-grid battery that stands alone and is usually accompanied by a set of batteries and a standby generator that saves electricity for you to use while the sun is not shining on cloudy days or during the night.
Cost of Solar Equipment
Though prices for solar may be dropping, the cost will vary depending on the type of system you choose, the size of your system, and your location. Some states have rebates and incentives that reduce the overall cost of solar electricity systems.
In general, a 2-kilowatt system, which should offset the electricity use of an average-sized home, will cost about $2,690 to $3,990 in total and its average payback is within 4 years.
Maintenance
Solar panels don’t require much maintenance, aside from an occasional cleaning of at least once or twice a year (or as needed). The price of cleaning on average should run between $120 and $267.
Providing regular cleaning and maintenance of your solar panels may be required if you lease your panels or keep your warranty current. Make sure to read the fine print in your agreement, so you’ll know if cleaning and maintaining your equipment is required (even if it’s not, it’s still a good idea!)
Tax credits
The Federal Government offers tax credits to homeowners who install solar energy systems. As well as STCs and FiTs, you may be eligible for rebates or other financial incentives offered by your state government. This includes the following state and territory incentives for households looking to go solar. Click here to see the summary of all financial incentives offered in your state.
So does solar increase your home’s value? It depends on your belief in the importance of renewable energy but also all of the factors above!