I’m sitting here at the Asilomar Conference Grounds, one of my favorite places on Earth, enjoying pure nature surrounding me. And it’s the forty year anniversary of Earth Day. For those of you who have not experienced Asilomar, it is located out on the end of the Monterey Peninsula (between Monterey and Carmel). It’s a place where it seems as though mountains meet the sea and wildlife is plentiful. Deer, raccoons, squirrels and blue birds are friendly, and so are the people who stay here. Reading the local paper these past few days has reminded me that the Solar Tribe has much to celebrate.

WholeSolar at EarthFair 2011

First, we’ve got a week to go for our National Solar Quote Month. April has been very good to many of us. WholeSolar was one of many exhibitors at San Diego’s annual EarthFair last weekend. The fair, which is held at the vast Balboa Park, drew more than 70,000 visitors. Needless to say, WholeSolar had a great opportunity to talk about solar, solar quote month and set many appointments with curious homeowners. This was my second time as an exhibitor at EarthFair. I love the people who attend. Mix that with National Solar Quote Month and the experience was a clear winner.

Yesterday I opened the San Francisco Chronicle and read a great article titled Solar Panels Boost Values. In a nutshell, the article reaffirmed what many of us in the industry already knew from a financial valuation perspective, but couldn’t put our arms around  any third party verification. Well here it is:

“Shell out the money to install solar panels on your home, and you’ll probably recoup that investment when it comes time to sell the house. You might even make a little profit. A study to be released today by Lawrence Berkeley National Laboratory found that solar boosts the value of homes, both new and old,” writes David R. Baker, Chronicle staff writer.

In addition, the home owner will get the benefits of reduced or even free electricity while living in the home. We’ve always known that solar increases home values in a manner greater than any home remodeling work does, we just couldn’t point to objective proof. Now we can. And, if you ask me, the study, which analyzed home sales between 2000 and 2009, might still come up short on the real increase in value that can be negotiated at arms-length by an informed home buyer and seller. To the home buyer, the value is derived from the free electricity received as a result of buying a solar home. The realistic question to be negotiated between the parties is the length of time that the buyer will receive this benefit. For example, quality solar panels and inverters will generate free electricity for many years, with minimal maintenance. And what about valuing increasing utility rates during this free electricity period?

The Lawrence Berkeley National Laboratory study documents that on 2,000 home resales, sellers at least recouped the cost they paid for their solar system, and then some. Perhaps it reflects the theory from the buyer’s point-of-view that, notwithstanding how much free electricity the buyer will save, that the maximum amount most buyers are willing to assign to solar is the cost that they would incur installing it themselves. Since the sale and purchase of a home IS a negotiation between two parties, if you are the seller with a solar home, make sure you are represented by a real estate broker who fully understands the benefits and has the ability to present them in terms of present values. If you do, I’ll bet your results will be better than indicated in this new study.

Having said that, it’s wonderful to have the new study as “baseline” third party evidence about the value of reselling a solar home.

To be continued…