Solar panels can be a suitable approach for property owners to save on electricity bills. But are solar panels right for single-family rental properties? While utility costs are a significant feature of answering this question, there are various factors to take into account before going ahead with the installation. The initial cost is a big factor, without a doubt, but so are things such as location and property values. You will moreover have to pick between a single rooftop or a community solar system. What it all comes down to, make sure to do the math. How quickly will it take to recoup the cost of your investment?
Cost of Solar
Without a doubt, there is no getting around the fact that every solar system will cost a significant amount of money. But in actuality, spending that money could create several great benefits before long, based on how you structure the initial cost of installation. Despite that solar panels and the other required components have decreased in price during recent years, installing an entirely new rooftop solar system will, for sure, still run into the thousands.
Many solar companies offer financing or payment plans, aiding property owners to apportion the cost of the installation over some months or even years. And, in quite a lot of states, you can be counted for other tax deductions that will help defray the cost of installation. But even so, the costs should still be factored into your cash flows before going forward.
Location
While solar panels will work well almost anywhere and everywhere, it is accurate too that solar power makes a lot of sense in several places than others. As an illustration, sunny southern states will permit greater efficiency and higher production rates for solar energy, while in localities with more cloudy days, that rate will likely be reduced. Additionally, if your rental house is shaded by nearby trees most of the day, that will clearly interfere in the solar system’s ability to generate high levels of electricity.
Effect on Property Values
Attaching solar panels to your rental property will quite possibly affect your property values. Just how much of a result, however, hangs on a bunch of stuff, in particular, the area of your property. Solar panels are clearly in demand in a lot of areas, in which case your property values – and your property’s appeal – may increase. But in reality, higher property values may result in higher property taxes, so it’s relevant to account for that chance in your decision-making process ahead of time.
Time to Recoup Costs
Most of the time, it takes a rooftop solar system about six to eight years to pay for the cost of installation. That includes the savings on your electricity bill. However, that time period will change substantially on the basis of your property’s site, how much sun your solar panels keep day-to-day, and so on. For homes in cloudy areas or with shaded roofs, it might take more than ten years before you can actually get to see any measurable return on your investment.
Solar System Options
If the idea of a rooftop solar system isn’t appealing, there are other options open for you. In various areas, property owners can easily join a community solar program. Community solar offers rental property owners a chance to reduce utility bills while also contributing to clean energy initiatives in their area. Other than that, you don’t have to install panels or other equipment on the property, which means the cost of investment is significantly lower. The huge downside is that community solar may not be obtainable in all localities, so it’s crucial to safeguard and check for availability beforehand.
No two rental properties are the same, and so on that note, the final choice to install solar panels on your rental (or not) is one that you will need to make for yourself. Although with reliable information and a solid understanding of your options, you can make that decision with confidence.
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