Add value to your property with Alternative Energy Systems.

Many people like the idea of reducing or eliminating their electric bill, relying less on the utility company, and treading lighter on the earth. But what if you decide to sell your property in a few years? Will an alternative energy system be a sound investment? The short answer is “yes!” The consensus is that your home value goes up. There are different ways to view this issue, and no one way is correct. Here are two different approaches:

Added Value

Imagine selling your home five years from now, when the new solar photo-voltaic system you’ve installed has paid for 80% or more of its cost. Let’s say, for example, the system cost $35,000 to install, and between the savings on your electrical bill and the incentives, you have recouped over $28,000 of your original investment.

You home goes on the market. Down the street, a comparable home who’s owners pay the utility company for 100% of their electricity, is up for sale as well. Now, Mr. and Mrs. Buyer come along, and they love both homes. When they calculate monthly payments including utility bills, they are saving about $280 per month (at today’s rates) with your home because of the solar electric system. That’s the equivalent of a $27,000 mortgage at 4% (which is locked in, because their utility bill won’t increase).

For Mr. and Mrs. Buyer, the decision is an easy one: they buy your house, and at a much higher price than the other house down the street.

Appraised Value

The National Association of Appraisers recently proposed another scientific approach. They took the value saved from each month’s electricity bill, annualized it, and multiplied that figure by 20 to get a value. Using the previous example, $125 per month x 12 x 20 = $30,000. This is about right for Southern Oregon.

The calculation varies by location. In Seattle, for example, where annual weather patterns reduce the effectiveness of a solar electric system, the value may be only $20,000. In southern California, however, with its sunny weather and the high cost of electricity, the value may be as much as $45,000.