Unable to find comps which have "owned" solar panels. What to do?

[Sandra Koutsopoulos]

Another downside to solar panels on tile roofs is that winds can jiggle wiggle the solar attachment to the tile roof, causing roof leaks. One builder in Yucaipa changed the plans for the tile roofed houses he built to shingles and told me the reason was he was finding the solar attachment to the tile shingles was causing leaks, and then he had to deal with angry homeowners. Most solar installers do not want to put the solar array on the ground, though I have see that on bigger, or hilly, or commercial parcels.
It would certainly be nice to generate your own electricity for your own individual house without depending on the grid, but the cost of the generator and batteries is out of sight, and the panels do not last indefinitely, so the payback period just means you are paying today for power you may use in the future. Not generally an overall savings... unless you heat your swimming pool to 80 degrees...

 

[George Hatch]

We have solar in this region and I still can't make an assumption as to the resale value in any given appraisal assignment. I always have to look because sometimes the difference among the sales data is distinct and sometimes it isn't. I consider the contributory of solar to be an opinion to be developed, not an assumption to make.

Other aspects of this issue include the points that buyer/seller attitudes are subject to change, and costs are coming down enough that the math that applied a couple years ago can be different than today.

 

[George Hatch]

TBH I don't care what the truth is about the various pluses and minuses of solar nor am I going to call someone stupid for deciding that TO THEM the cost = value. I only care about identifying how the market participants as a group are reacting to these installs.

Forget what people *should* do if they were being completely rational and look instead for what they actually *are* doing in these sales transactions.

 

[Terrel L. Shields]

the cost of the generator and batteries is out of sight, and the panels do not last indefinitely, so the payback period just means you are paying today for power you may use in the future. Not generally an overall savings... unless you heat your swimming pool to 80 degrees...

Buy a place with an abandoned gas well and problem solved....this place had 2 such wells and each could run an awfully large generator for years, if not decades to come.

 

[Sadie]

Actually, I can - and I did. Unless you know of some law that recently went into effect prohibiting that kind of statement?

Actually you can say what ever you want, bless your heart.

 

[glenn walker]

TBH I don't care what the truth is about the various pluses and minuses of solar nor am I going to call someone stupid for deciding that TO THEM the cost = value. I only care about identifying how the market participants as a group are reacting to these installs.

Forget what people *should* do if they were being completely rational and look instead for what they actually *are* doing in these sales transactions.

Extremely high pressure sales people many went into after the Subprime Mortgage meltdown.
I had one guy from Solar City tell me I could end up with Zero Electric Bill. I said thats BS but even if you could my electric bill averages around $100 a month or $1,200 a year so if I pay $20,000 for a system. it would take
16 years to pay for it self. I figured that would get rid of him but now the dumb-*** starts talking about climate change and saving the world and I and like OK no more get the F-Off my lawn and learn rule #1 is sell something to a person that will by it and thats not me.

 

[alebrewer]

Actually you can say what ever you want, bless your heart.

Well, not quite - at least not without going into the penalty box. That said, and even though I CAN say mean stuff - I've tried really hard over the past few months not to. Not so easy on this forum.

 

[George Hatch]

Buy a place with an abandoned gas well and problem solved....this place had 2 such wells and each could run an awfully large generator for years, if not decades to come. View attachment 58481

Yeah but you're a mineral rights guy, so you know that the rights to that gas might already belong to someone else.

 

[alebrewer]

I challenge that. The online calculators conclude to what a buyer who is operating strictly off the income - and who is capable of performing that type of analysis - would do. But most of the calculators I've seen omit some important assumptions and used arbitrary assumptions which are not usually demonstrated in the resale market. And almost no borrowers have the competency with that type of analysis. Which also goes for some of the bankers and most of the SFR appraisers.

Income approach can't be done without reference to the value in the market. You can't build a GRM/GIM or a cap rate or a discount rate without an actual or assumed resale value, nor can you extract one from the market (which is always the most reliable way of getting to a GIM or Cap Rate) without such sales data. The calculators I've seen skip or gloss over that element, and the effects of that on the outcome are profound.

Just the fact that the resale values of these systems varies by both locale and price range demonstrates that solar is just as subject to the axiom that "all RE is local" as any other attribute. When performed competently, the results of an income approach will line up with the results of an SC because if it isn't then that means the GIM or cap rate or discount rate is wrong.

Just like homebuyers aren't appraisers (and yet most are capable of arriving at a reasonable estimate of MV via their own research/analysis, etc.), neither are they (necessarily) proficient at DCF - although I'm sure some, if not many, are. My point was - and still is - that any property modification that generates savings/income streams will be considered by a buyer and that consideration will factor into the purchase decision. They may not be using DCF, they may not know a 'market' discount rate, but I PROMISE that buyers consider factors that reduce their overall monthly outflow for a piece of property.

Case in point - I just bought a piece of property in Oklahoma that generates a meager return on an oil easement. I was willing to pay a bit more for the property than I otherwise would have, had it not had the modest monthly return(s).

To say that buyers don't consider those features is just silly.

 

[glenn walker]

Well, not quite - at least not without going into the penalty box. That said, and even though I CAN say mean stuff - I've tried really hard over the past few months not to. Not so easy on this forum.

Yeah I actually liked you better when you were a First -Class A-Hole now I feel guilty beating up a fairly nice guy. We Gotta get Mr Rex back as I enjoyed watching him and Greg Boyd go at it