Home buyers are willing to up to $15,000 more for houses with their own solar power systems.
A major survey by the U.S. Department of Energy’s Lawrence Berkeley National Laboratory found that buyers were willing to pay an average of about $4 per watt of PV installed – which equates to a premium of about $15,000 for a typical 3.75 kW PV system.
As of 2014 more than half a million U.S. homes had PV systems. The study — called “Selling into the Sun: Price Premium Analysis of a Multi-State Dataset of Solar Homes” – analyzed nearly 22,000 home sales in eight states from 2002 to 2013.
“Previous studies on PV home premiums have been limited in size and scope,” said Ben Hoen, the lead author of the new report.
“We more than doubled the number of PV home sales analyzed, examined a number of states outside of California, and captured the market during the recent housing boom, bust, and recovery.”
The growth in home PV systems means that the real estate industry will need reliable methods to value these homes appropriately.
Further, having greater certainty in those methods will likely facilitate additional growth in the residential PV market.
Two members of the national Appraisal Institute contributed to the landmark study.
Sandra K. Adomatis, SRA, of Punta Gorda, Florida, and Thomas O. Jackson, Ph.D., MAI, of College Station, Texas, were part of a multi-institutional research team of scientists led by Berkeley Lab, in partnership with Sandia National Laboratories, universities and real estate appraisers.
“The role that these two Appraisal Institute members played in this important study is typical of the thought leadership our organization provides,” said Appraisal Institute president M. Lance Coyle, MAI, SRA.
“As the nation’s largest professional association of real estate appraisers, our membership includes some of the highest qualified, best educated and most experienced valuation professionals in the world.”
The study allowed the team to produce the most authoritative estimates to date of price premiums for U.S. homes with PV systems.
The Appraisal Institute’s involvement in the solar research is only the latest in its long list of green and energy-efficient valuation leadership.
Since June 2008, the Appraisal Institute has offered nearly 450 individual programs on green and energy efficient valuation, and more than 6,250 attendees have participated.
In June 2014, the Institute announced its support for a U.S. Green Building Council report that found green labeled homes can sell at higher prices. A green label adds an average 9 percent price premium, according to a study that analyzed 1.6 million homes sold in California between 2007 and 2012.
At the request of appraisers’ clients, in April 2014 the Appraisal Institute expanded its Valuation of Sustainable Buildings Professional Development Program’s online registries of residential and commercial appraisers to include everyone who has completed the course.
The Berkeley Lab’s research was supported by funding from the U.S. Department of Energy SunShot Initiative. The SunShot Initiative is a collaborative national effort that aggressively drives innovation to make solar energy fully cost-competitive with traditional energy sources before the end of the decade. Learn more at energy.gov/sunshot.
Lawrence Berkeley National Laboratory addresses the world’s most urgent scientific challenges by advancing sustainable energy, protecting health, creating new materials, and revealing the origin and fate of the universe.
The University of California manages Berkeley Lab for the U.S. Department of Energy’s Office of Science. For more, visit www.lbl.gov.
The Appraisal Institute is a global professional association of real estate appraisers, with nearly 21,000 professionals in almost 60 countries. Learn more at www.appraisalinstitute.org.