Wind turbine and solar panels-will they increase your home value?

I looked at a home last week that offered a wind turbine and solar panels. This home was located on around 2 acres of land. The solar panels and wind turbine are used to decrease the power usage for the home. Per the owner, in the summer, the power meter runs backwards. Wouldn’t that be cool? The power company is paying you.

My assignment was to determine if these items influence the value of the subject. My research included four hours of research reviewing comparable sales in the area. I reviewed all of the listings, pending sales and closed sales for the prior four years. In and around Spokane, WA, there are only a small number of homes that meet these criteria. Now if you know anything about the appraisal process, you are aware that most banks and FHA appraisals will not allow sales older than one year in the first three positions of the appraisal.

The reason I went back this far in time is to determine if the market is willing to pay for the cost of any green homes or wind turbines or solar panels. I called all of the Realtors in the area that have any experience in listings or selling homes with wind turbines or solar panels. The Realtors that I spoke with were all consistent in there answers.

The market perceives green homes, wind turbines and solar panels as a positive. However they will not pay the extra money for these additional items. In some cases, the homes may sell faster than other homes in the area, but again, the market is not willing to pay for the cost of installing these items.

Do you know why solar panels or wind turbines will never increase the value of your home in some areas? Because there are simply not enough comparable sales to make a clear conclusion that solar panels or wind turbines will support a value adjustments.

The only time that you will want to install solar panels or wind turbines is if you plan on staying in your home for a significant period. The only time that these items will increase the value of your home is if there are enough of sales in the market area to support a conclusion. If there’s not enough data in a give area, then the value will never be supported.

While reviewing all sales in the area, I was not able to location any recent sales that offered wind turbines. I was able to located two homes that had actually closed within the past year that offered some form of a green home. I also located two listings in the entire county of Spokane that were within 15 miles from the subject. One of the listings offered the similar square footage as the subject and offered a wind turbine and solar panels.

The other home was listed for around $10,000 less than the home was purchased for two years prior. At the time of this appraisal, market conditions showed declining prices, therefore no clear correlation can be linked between the solar panels causing the prices to decline.

In all cases, wind turbine or solar panels will not increase the value of your home. In many cases, the cost to install these types of systems will be significant and the cost to install these systems may take 20 or more years before you pay for the installation.

In conclusion, only install wind turbines and/or solar panels to help decrease energy consumption, but never assume that you will be able to sell your home for more money or refinance your home for the cost of installation or more.