Real estate agents skeptical about price of homes with solar panels
PhotovoltaicsKatie Nelson and Rachel Banning-Lover talk about photovoltaics and their effect on housing prices in Berkeley.
Thursday, April 28, 2011
Category: News > University > Research and Ideas
While a study by Lawrence Berkeley National Laboratory has found that California homeowners who invest in photovoltaic systems will earn up to 6.4 percent in resale prices compared to those who do not, some Berkeley real estate agents remain skeptical as to whether solar panels will act as an incentive for buyers to pay higher prices when buying a house.
The study, released April 21, surveyed 72,000 homes fitted with photovoltaics, also known as solar panels, across California and compared two types of houses - those built prior to having photovoltaics installed and brand new houses built with photovoltaics already installed, according to Ben Hoen, lead researcher on the study and a principal research associate at the lab.
New houses were found to sell for a lower price than older properties where the previous owners had installed panels after moving in, Hoen added.
"The assumption is that a buyer and a seller agree that the house has an increased value as the carrying costs are lower," he said, "This was a question that had been out there for years - those selling solar panels had speculated houses with them would sell for more, but no one had tested it previously."
Hoen added that new homes were less likely to profit from having photovoltaics on the roofs than older homes because developers were more focused on selling the property than getting the highest price in an uncertain housing market.
"New home sales are down about 80 percent (this year), so sellers are trying to find creative ways to sell houses," Hoen said. "Developers of new houses are doing something similar - using (photovoltaics) as an advertising gimmick."
Anything that reduces the cost of ownership makes a house more valuable in today's buyer's market, according to Gary Gerber, president and CEO of Sun Light & Power, a company that installs solar panel systems.
"Most of my customers are motivated more by their carbon footprint - I haven't seen people installing panels specifically for increasing their house price, but people do ask," he said. "The study means we can now tell customers with confidence it will raise the price."
But real estate agents are speculative about whether houses with solar panels will sell for a higher price on the Berkeley market.
"I've worked here 25 years, and my gut feeling is that it doesn't make a difference," said Nacio Brown, a realtor for Pacific Union International. "Size, the feel, the neighborhood - that's what matters; solar panels are like gravy."
But having photovoltaics would still be an asset worth touting to potential buyers, especially in Berkeley, where a majority of the community considers itself a "green community," according to Kathleen Curry, a realtor for Thornwall Properties, Inc. But she added that overall, it is not the biggest concern to buyers.
"Buying a house is still such an emotional thing - people want to love it for its character as well as its improvements," she said.
Jeff Rosenbloom, a real estate agent for Marvin Gardens Real Estate, said he would still add value to a house's list price if it had solar panels, estimating an added value of around $10,000 for the home.
"Most of my business is done in Berkeley and Oakland - carbon footprint-conscious communities - and I think people are willing to pay a little bit more to have their house be solar, being a more green house," he said. "Recycling energy consumption has an intrinsic value."
Comments (0) »Comment Policy
The Daily Cal encourages readers to voice their opinions respectfully in regards to both the readers and writers of The Daily Californian. Comments are not pre-moderated, but may be removed if deemed to be in violation of this policy. Comments should remain on topic, concerning the article or blog post to which they are connected. Brevity is encouraged. Posting under a pseudonym is discouraged, but permitted. Click here to read the full comment policy.