Does Solar Power Increase the Value of My Home in the Regina, Saskatchewan Housing Market?
The short answer is yes! According to a Berkeley Study performed in California (http://eta-publications.lbl.gov/sites/default/files/lbnl-4476e-ppt.pdf), results showed that installing solar on your home can increase its value up to 20%! With that being said, we are installing solar in Saskatchewan where solar is not quite as popular as California…. Yet!!!
The Long Answer…how could we find out a relevant numerical value here in Saskatchewan for installing solar on your home? We decided to go straight to the source to find what type of impact solar would have on a home’s value. We had a residential home appraisal completed on a house here in Regina with solar installed on it.
Here is the background information of the solar-powered system installed on the house:
- Location of Solar Installation: 325 Halifax St, Regina, Saskatchewan
- Size of Solar Installation: 5.4kW (18 – 300W Trina Solar Panels)
- Cost of the Solar Installation: $19,995.00 – GST & PST Included
Results of the Appraisal?
The house came back with an appraisal value of $329,000.00 with the new solar panel system installed. If the same solar power system was installed on three similar homes in the area, the increase in the value of those homes would be exactly $10,000. Therefore, we could assume that if you install Solar Panels in Regina on your home for $19,995.00 you are instantly getting back about 50% of your investment.
We could also use this number, of a $10,000 increase, to translate it into a percentage of the instant increase in value that solar adds to your home. The value of the home in this appraisal was worth $319,000.00 without solar panels and it is now worth $329,000.00 with solar panels. We can translate this into an instant increase in your home value by 3.13%. Based on this appraisal, we can now assume that by installing solar panels on your home, you can expect an increase of the value of approximately 3.13% on the home’s value.
On top of the instant increase to your houses overall value, we can further calculate the benefits that solar offers by considering the amount of savings to be had by offsetting your current power bills! With a 5.4 kW solar system, like the one installed here in Regina, on a South facing roof panel, you can expect to produce 7560 kWh in a year. What does that work out to be in actual dollar value? Well, in January of 2015, SaskPower was charging 12.33 cents per kWh of power. So let us break this down further:
- This would be $932.35 dollars a year
- Plus, 10% for a municipal surcharge ($93.24)
- Plus an additional 5% for GST ($46.62)
- For a total annual cost of $1,072.21
More recently, in October of 2018, SaskPower was charging 14.228 cents per kWh which would result in an annual cost of $1,236.99 ($1075.64 before tax plus the additional 15% for surcharges and taxes). As you can see, there was a 15.36% increase in the utility rate in just under 4 years. However, having solar power on your roof will not only save you in power bills, but it will also make you exempt from the rising utility rates!
Installing solar panels is certainly a long term investment if your only formula for savings is based on power consumption. But, the increase in the value of 3.13% on your residential home is immediate and permanent. So if you think about it, based on this appraisal, the instant increase to your home pays for 50% of your upfront solar costs! That leaves the remaining 50% to be recuperated through power savings. The overall savings from solar panels will only increase as the cost of power goes up. This will probably be the only time you are excited to see an increase in utility rates!! Furthermore, if you also include the 20% rebate that SaskPower is currently offering until the end of November 2018, then really 70% of the cost of your solar installation is paid for as soon as you have it installed!
So how long does it take to recover the remaining 30% of the solar installation cost???? Since 30% of this solar installation cost would be $5,998.50, and the homeowner is now saving $1,236.99 dollars every year on power, it would take under 5 years to have the entire system paid off! Don’t believe us on our numbers? Check out the appraisal report for yourself attached here!
Residential Solar Appraisal – How Much Does Solar Increase the Value of You’re Home