As a Realtor, I get asked questions regarding what's new in Real Estate and what is coming in the future for technology and saving money. I help clients make money. I do it two ways; by saving them from investing dollars where there is no return and also by telling them where they will get the best bang for their buck.
I have been getting a lot of questions from my clients this year regarding Solar Panels. "Should we buy them Brady?" We are seeing them show up more and more on rooflines and neighbors are hearing how "great it is to save on utility bills." Are they worth the investment? Will Buyers pay more for a home with Solar Panels? Let me answer both quickly then I will explain- NO to both questions. Please don't buy them. Yet.
I want to share three reasons why I personally wouldn't touch purchasing Solar Panels on your Residential Home yet. I absolutely think they are our future and eventually they will be on every home. Personally, I love helping the planet. Anything we can do to make this place a little better than for the next generation is great
Just had to throw that out there! Solar Panels look and sound cool right now, but here are my three reasons they don't really work for you as a consumer yet..
1) You can't afford to BUY them!
Have you ever heard common sense parents or grand parents tell you, "If you don't have the money, don't buy it!" Crazy right? We live in an age now where your car dealerships won't even tell you the price to purchase the car. They only tell you what it will cost per month. The price to pay for something per month sounds way better than the final price tag. So they don't tell us what it is until they have to. It does sound amazing that we can drive a brand new car for $299.00 a month and the car comes with a ribbon and snow falling all around it. I love those commercials!
The problem with this concept is if we tell ourselves we can just afford it every month, then the price to purchase doesn't really matter. But it does!
In my experience, the homes you are seeing right now with Solar Panels have one HUGE problem. They're not PAYING for them yet! They're getting them installed, but they're not paid for. They are long term payment plans or leases and warranties are often voided should the home need to be sold.
Solar companies have all kinds of tricks up their sleeves to sell you on all of the upside to going Solar. See my reasons 2 & 3 below to learn about the common ones I hear.
Consumers are purchasing these Panels on a payment plan. It is scheduled out over 5-7 years often times with a "FREE" year to get started before you have to pay anything at all.
Why it doesn't work? Going further into debt and paying $100's of dollars a month to save from spending a couple hundred dollars a month doesn't make a whole lot of sense.
2) You don't plan on staying long term
Don't believe a twenty something wearing a flat brim hat standing on your porch telling you when you buy your panels, your home value will go up.
You're home VALUE does not go up when you buy Solar Panels. Buyers are not willing to pay you more for the home nor are they willing to absorb your bad debt payment for borrowing the money. PLEASE believe me. Solar Companies are selling consumers on the idea that the value of your home does go up. IT DOESN"T.
Whether or not buying Solar Panels is a good idea can be figured out quickly by doing some Math. If the cost of the panels are $30,000 and you are indeed getting a rebate of some sort, you can factor all of that in and find the break even point for how long you would need to stay in your home to start "Saving" money from your panels.
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Usually the break even is 5-7 years. The main problem with having a loan on your home, additional to your mortgage, for 5-7 years is this: LIFE HAPPENS. Sometimes you have to move! Job relocation, loss job, divorce, death etc.. are some of the reasons people have to make hard decisions and move earlier than expected. It happens. When life problems happen, bad decisions escalate quickly. The math quickly turns into 2 or 3 years instead of 5 or 7 and you have to pay the debt off prior to selling the home or you're in trouble. If you can't pay the cash or have enough equity to absorb the loss, you are officially "screwed." I have seen it happen and it is not good. Buyers won't "take on the payments" for your Solar Panels. No one wants to buy your truck and "take over the payments" either. You can't sell something you don't own. Or at least you shouldn't be able to in this case.
3) Early Adopter phase
Do you remember 10 years ago how much you needed to spend to buy that amazing plasma TV? All of your friends were starting to buy them and it felt like you needed to get in on the action.
I remember buying my first plasma TV and it set me back over $2,000! It was large and chunky and about double the weight of the current TV I have now that I only paid $350.00 for. What does this mean? Give Solar some time. Prices will come down. Just like your TV did. Solar products will be much smaller and more efficient in the near future. It will also look better sitting on the side of your home as well. Personally, I'm not down with the product we are seeing stapled to your roof. Neither are buyers. However, they do start looking better when they are paid off.
Agree or strongly disagree? I'd love to hear about it. email me firstname.lastname@example.org
As a Realtor, I specialize in helping my clients get to dollar when they sell their home. I can put money in your pocket. I can assure you that you have money slipping out the door in every room of your house. Let me come tell you what you need to do to get your home ready to sell.
Brady Tanner is the Owner and Principal Broker at PRIME RESIDENTIAL BROKERS located in Salt Lake City and RIverton Utah.
Call Brady if you are looking to buy or sell your next home!
Check out my listings and see how I can help you by visiting www.primeslc.com
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We achieve this accord by serving our clients with the heart of a teacher.
From luxury listings to first time home buyers, we dedicate our time, resources and knowledge, to achieve a very personal an rewarding real estate experience.