How Investing in Solar Can Increase Your Property Value

Investing in solar energy can initially be a daunting task for residential and commercial property owners. The upfront cost of solar energy systems can be significant, even with the help of grant programs and tax credits. As a leading solar provider in northwest Montana, we have found that the overwhelming majority of our clients have multiple reasons for investing in solar, ranging from an urge to help the environment to seeking out less energy dependency to the grid. 

From our perspective though, one of the greatest advantages to investing in solar, whether in a residential or commercial application, is the significant impact that a solar energy system can have on the owner’s property value. 

According to a study conducted by the U.S Department of Energy’s Lawrence Berkeley National Laboratory, installation of host-owned photovoltaic energy systems can drastically increase the value of a residential property. The study was led by Sandra K. Adomatis, a designated member of the Appraisal Institute with a specialization in green appraising. Green appraisal incorporates the impact that energy efficiency can have on the valuation of residential and commercial properties, and has become an increasingly important part of the appraisal industry. 

The study estimated that “each 1-killowatt (kW) increase in rooftop solar system size adds $5,911 to a home’s resale value.” In other words, a 10-kilowatt photovoltaic energy system can add up to $60,000 to your home’s value on the market. With an influx of prospective home buyers moving to the valley, and an increased concern in the wellbeing of the environment, a solar system may be the addition to your home that sets it apart from the rest of the market. 

The same benefits and more can apply for commercial building owners. For commercial building owners investing in green energy systems, such as a photovoltaic energy system into a commercial building can pay positive dividends with employees and renters, as well as potential commercial property buyers. 

According to a new economic analysis of the state of office buildings throughout the United States, investing in energy efficiency and green building certifications can increase the value of a commercial property significantly. While installing solar is just one step to increase the environmental sustainability of a commercial property, these steps are noticed by prospective employees and customer bases. 

“Energy Star ratings and LEED certifications are just check-the-box marks today in corporate leasing decisions,” writes Dr. Randall Zisler, a real estate economics expert and chair of Zisler Capital Associates. “Employees are also insisting that their companies take actions that combat climate concerns. In many industries, there is a war for talent today. Therefore, buildings with the systems and technologies that help companies fulfill their carbon neutrality goals as well as recruit and retain top flight talent will be rewarded with higher rents and values.”

According to Zisler’s study, Business owners that do begin to invest in energy efficiency and building health can see valuation increases as drastic as 20%. In the modern era of business, employees, commercial building renters and prospective buyers are greatly valuing measures to become more sustainable, and are willing to pay a premium to owners that are trying to do their part. 

In an ever growing Montana economy, the ability to set yourself apart from competitors has never been more important. Whether you are a company owner looking to recruit and retain high level employees, or a residential property owner looking to increase the value of your home, an investment in clean energy could be what sets you apart. 

For more information on photovoltaic energy systems contact Northstone Solar today. 

Sources:

https://www.appraisalinstitute.org/solar-energy-systems-boost-home-values-says-appraisal-institute-member-led-study/

https://www.ecowatch.com/solar/solar-panels-increase-home-value

https://cleantechnica.com/2013/12/17/study-shows-rooftop-solar-adds-thousands-to-home-resale-values/

https://www.prnewswire.com/news-releases/alarming-obsolescence-will-reprice-us-office-properties-due-to-esg--tenant-health-demands-301499149.html