Solar panels and green homes are becoming increasingly common in the marketplace. If you’ve seen a rise in solar PV systems in your area, consider taking the first steps toward competency in the valuation of this energy-efficient feature of real estate. Below you’ll find answers to some frequently asked questions about appraising solar panels.
Interested in appraising green homes? Download this free ebook to learn the ins and outs of green home appraising.
How often do appraisers encounter solar panels?
It depends on where you’re located. But in general, it’s more and more common to see solar panels on residential properties throughout the country. The declining costs of solar PV systems along with tax breaks and rebates have made these systems more affordable and more attractive to property owners than ever.
Solar panels will continue to become more widespread into the future. Across the U.S., 38 states plus Washington D.C. already have some form of clean energy goal in place, with some states aiming for 100% by 2050. For example, California’s goal is to be 60% renewable by 2030, and 100% by 2045.
What basic properties of solar panels should appraisers be aware of?
The main categories of solar are photovoltaic (PV) and thermal. Solar PV converts sunlight to electricity. Solar thermal directly heats water. The most common types of solar panels you will encounter are monocrystalline (more expensive, more efficient) and polycrystalline (less expensive, less efficient). With the PV solar systems, there will also be an inverter—either a microinverter (more expensive, more efficient) or string inverter (less expensive, less efficient)—typically found on the side of the home. Solar panels may be roof-mounted, ground-mounted, or dual-axis (rotates to track the sun’s path).
For a more in-depth discussion of these systems, their component parts, and how they operate, enroll in our CE course, Valuation of Residential Solar.
What are some of the key challenges of appraising properties with solar?
Key challenges you will likely face when doing these types of appraisals include:
- Finding comparable data
- Determining market acceptance
- Demonstrating value
Anything else appraisers should know?
If you are appraising a property with solar panels, the first thing you’ll need to figure out is whether the solar array is owned or leased. If the appraisal is completed for mortgage lending purposes, lenders are responsible for informing you of the accurate ownership structure of the solar panels.
How can appraisers learn more about appraising solar panels and green homes?
Want to learn more about the emerging solar and high-performance home niche and diversify your appraisal practice? Gain professional expertise and become a certified specialist in this growing appraisal niche with McKissock’s Certified Green Home Appraiser (CGHA) program, which includes the following appraisal CE courses:
- Green Building Concepts for Appraisers
- Valuation of Residential Green Buildings
- Valuation of Residential Solar
Enroll in McKissock’s Certified Green Home Appraiser (CGHA) program—included with your Unlimited Learning Membership.
Editor’s note: This post was originally published on October 5, 2018, and updated on June 29, 2021.
