End Of Life Solar

[PushinValue]

conventional purchase assignment

2004 build home with solar installed by the builder.

Estimated economic life of 20 years

Per buyers agent, solar is shot, 30k to replace.

Panels are not visible from the street and only evidence of system is an inverted in the garage.

How do you handle this? Never seen this issue and spoke with many agents who have never had this come up.

How do you account for the non functional equipment? Still waiting on the cost to remove. I couldn’t imagine the impact being as much as the cost to remove (since you cannot even see the system, why remove it?).

Thoughts and ideas are welcome!!

 

[PushinValue]

Note- contributory value of a new system in the area 2-7k and there is no part of the system that can be reused.

 

[Randolph Kinney]

2004 build home with solar installed by the builder.

Estimated economic life of 20 years

Per buyers agent, solar is shot, 30k to replace.

So the solar panels were suppose to last until 2024 but are dead today. How many solar panels in the neighborhood still work? Would the current owner consider buying new solar panels on his next house given the life of the solar panels is less than 15 years?

Note- contributory value of a new system in the area 2-7k and there is no part of the system that can be reused.

When the cost to replace exceeds contributory value, isn't that a superadequacy?

A superadequacy is a form of overimprovement; it's a design feature whose cost is greater than its contribution to value.

So as it stands, the solar panels subtract from value and the cost to remove and repair any damage is the starting point for adjustment plus a market penalty.

 

[Restrain]

Removal of solar panels may also involve significant roof repair/replacement costs.

1. Substantiation of failure of solar panels from a third party.

2. Estimation of cost to remove and repair roof

3. Value subject as if no solar, physical depreciation for cost to remove, possible market resistance to having to spend the extra bucks to get the panels removed.

Ain't valuing properties with solar panels fun?

 

[Meandering]

No warranty to protect that future income, or the "value added" in the first place???



Figure it out, because this won't be the last one with this issue.

.

 

[Terrel L. Shields]

Cost to cure.

 

[glenn walker]

Most panels are warranted for 15 years and the seller should try to get them replaced otherwise it's a cost to cure ?

 

[George Hatch]

Sooo, the suggested valuation model in the spreadsheet application doesn't work on this install? Something about inaccurate or incomplete assumptions not holding up over the duration of the holding period? IRV didn't work this time?

That's unfortunate.


Anyways, I'd be looking for contributory value* of a functional system in this market - cost to cure.

*Contributory value to be demonstrated among the sales data.

 

[AMF13]

Most panels are warranted for 15 years and the seller should try to get them replaced otherwise it's a cost to cure ?

They probably pro rate it like a car battery.. You get a $50 coupon if you're lucky.

 

[Randolph Kinney]

Quite a few solar panel companies went out of business since 2004 so I doubt the warranty was any good.