Evidence from real estate agents and bond originators suggests homes with solar systems installed can increase the property value by 3-8%.
It’s early days yet, and we may only have a clearer picture of the impact of solar installations on property values in a year or two. But the early evidence, largely anecdotal, is encouraging. A survey by Pam Golding Property Group found solar topped the list of features property buyers are looking for.
Marc du Plessis, executive head of LookSee, a home efficiency platform launched by Standard Bank, says that while the evidence suggests a home with a solar installation is likely to fetch a higher price than one without such a system there are other, less visible benefits.
Enhanced negotiating capacity for home sellers
“From a seller’s perspective, you are more likely to hold the line in terms of price if you have a solar installation,” says Du Plessis. “Where you have a buyer looking at two similar homes, one with a solar installation and one without, [they] are more likely to choose the home with solar and be prepared to pay more for that benefit.”
Other benefits for sellers
There is greater demand for homes with solar. Apart from increasing property values and allowing sellers to hold the line when it comes to negotiating price, estate agents and bond originators are reporting that one of the first questions being asked by buyers is whether the home comes with a solar installation.
“There’s no question that this has become a deciding factor in the property market and this will likely become an even more important factor in the property market in the months and years ahead,” says Du Plessis.
“There’s another factor to bear in mind, and that is faster sales. Homes will likely sell faster where they come with some form of backup power and water, such as a borehole or water tank. There’s a big and growing demand for ‘green’ features such as power backup and water when it comes to home sales.”
Benefits of solar for home buyers
Reliable power supply and protection from load shedding: The ability to continue working despite power interruptions is a huge benefit of solar. Though load shedding has improved in recent weeks, it has not disappeared entirely and we should be prepared for more unplanned outages in the months ahead. Having a solar system allows you to continue working from home and maintain productivity.
Electricity savings: Depending on the size of the solar system (with inverter and batteries) installed, electricity bills savings can be as much as 30% or more a month.
Electricity savings to pay off home loan faster: This is a benefit often ignored by homeowners. Savings of anything between R1 000 and R3 000 a month can be used to pay off home loans, shaving years off the life of a mortgage loan, with huge savings on interest.
24/7 security with always-on power: Another overlooked benefit of solar with inverter and batteries is the ability to keep home security systems powered up at all times, even during load shedding. Insurers have reported a surge in home break-ins during load shedding.
Buying a home with solar is less hassle than doing it yourself: While solar systems can be rapidly installed, buying a home with solar is more convenient as it does not disrupt activity around the home, and any post-installation teething problems have likely been ironed out.
Impact of solar on those looking to buy rental properties
It’s not just home buyers who are on the hunt for properties with solar systems pre-installed. Renters, too, are on the lookout for properties with backup power.
“While demand for rental housing is at a high, landlords are currently having to deal with increasing levels of defaulters,” says Du Plessis. “Choosing a rental property with solar allows landlords to focus on securing quality tenants who will not default and will maintain their properties.
“Back-up power is a growing demand for tenants, particularly in the medium to higher end, and will give landlords a larger pool of tenants who are willing to meet their asking price. This means landlords can screen for quality tenants.”
LookSee’s new Solar Loan scheme
LookSee’s new Solar Loan is designed to appeal to the needs of most power consumers: loan sizes range from as little as R3 000 up to R300 000, with interest rates that are capped at a maximum of prime plus 2.5%. This is a substantial discount on the prime plus 7% offered on personal loans, or the maximum prime plus 17.5% mandated by the National Credit Act.
Getting the right system for your needs
LookSee’s Home Solar process is a good place to start the solar journey, says Du Plessis. “The purpose of the analysis is to identify the ideal system size for your needs by looking at your current electricity usage, from which we can recommend a suitable solar package, complete with an estimation of how much of your power needs this meets. There are also alternative system sizes that are available for those who are looking for something different.”
For more information, click here.
Brought to you by LookSee.
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