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Published on October 23rd, 2010 | by Susan Kraemer

18

Solar Homes Sold 20% Faster, and for 17% More, NREL Study Finds

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October 23rd, 2010 by
 
 

In by far the most exhaustive and detailed study to date, the National Renewable Energy Laboratory (NREL) found that solar homes sold 20% faster, for 17% more than the equivalent non-solar homes, across several subdivisions built by different California builders.

When Shea Homes put solar PV and solar thermal systems on half the homes in a development, all 257 of them sold within a year, two years faster than expected. And while these new houses were priced at $380,000 to $500,000, they sold for as much as $600,000.

This was well before the housing crash, so it represents the buoyant market of that time, in 2003. Still, it found that compared with non-solar homes, the houses that had solar on them sold for more. While the average price increase related was 55% for the solar homes, the non solar homes appreciated only 33% (pg 49.) This represents a 20% higher sales price for solar homes.

The Clarum Homes’ solar homes in the study also sold faster than their “control” homes. The solar homes sold in 23 months, the non-solar, in 28 months. This is a 17% faster home sale for a solar home.

The solar homes appreciated 20% more, and sold 17% faster than the non-solar homes.

After extensive interviews with the home buyers in the development, the (413 page pdf) NREL study made some other interesting findings.

If solar was already on the house, and factored into the price already, buyers were more likely to pick a house with solar. But if it was just one more decision to be made at the point of purchase, the decision got shelved.


This was found to happen because the salespeople were more likely to neglect to bring up the option altogether, for fear of losing a sale to indecisiveness. After all, they can’t even sell the house till the buyer has decided on either the Neon orange Corian or the Tuscan granite for the counter tops. They can sell the house without solar, but not without the counter tops.

Why builders should make solar standard:

By contrast, instead of leaving the decision to the salesperson, simply building the house with the solar system as standard was found to be behind the successful widespread adoption of the solar powered homes. Some of the homes were built with solar on them already, so there was no decision needed. The sales comparison between them and the non-solar homes formed the basis of the discovery of the 20% higher prices, and 17% faster sales.

Solar as the standard was also more profitable for builders themselves, the study found. In one California development, all 306 homes included solar hot water systems and 120 also included PV systems. That builder found that it was more profitable to build in the solar systems as the standard feature rather than wait for homeowners to request an upgrade and to add the solar in those instances later.

Even modest reductions appreciated:

Also, interestingly, the homes are not nearly as solar powered as they could be, with relatively modest reductions in their electricity bill. But the buyers were very satisfied with their energy bill reductions. Homes had small 2.4 KW PV systems (as well as solar hot water systems) that reduced their energy bills by only 54% compared with comparison homes.

Of course, it depends on how many plasma TVs are inside, but the average home like this needs about a 6 KW system to supply all of its electricity.

And were these just crunchy granola-chomping lefty hippies buying the solar homes? Absolutely not. The study found no differences between the solar home buyers and the average buyers for these sorts of homes. But the buyers were thrilled with their savings.

As the NREL study concludes, these results suggest:

“…a conceptually fresh alternative paradigm for the building and marketing of new Zero Energy Homes. When this paradigm is used, builders, new home buyers, and utility companies will benefit. When appropriately applied to business practice and public policy, this new paradigm will help builders create the sustainable communities so necessary for our well-being and that of future generations”.

Image: NREL
Susan Kraemer @Twitter

More: Watch this video on Solar Home Value.

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About the Author

writes at CleanTechnica, CSP-Today, PV-Insider , SmartGridUpdate, and GreenProphet. She has also been published at Ecoseed, NRDC OnEarth, MatterNetwork, Celsius, EnergyNow, and Scientific American. As a former serial entrepreneur in product design, Susan brings an innovator's perspective on inventing a carbon-constrained civilization: If necessity is the mother of invention, solving climate change is the mother of all necessities! As a lover of history and sci-fi, she enjoys chronicling the strange future we are creating in these interesting times.    Follow Susan on Twitter @dotcommodity.



  • Scwebstuff

    Erm. I’m confused. In the first paragraph, you say sold 20% faster and for 17% more money, but further down, you reverse that. Which is it?

  • http://www.greenenergyinsiders.com/ Maxie Coale

    Great findings! Just another benefit of using clean and green energy and energy efficient products and methods.

  • http://www.leosunergy.com Scott Carpenter

    This study is defintily outdated and the numbers are better today. PV modules have come down nearly 30% in the past 11 months. Also homes can be built much tighter today with greater insulation also reducing their kWh as seen in Clarion Homes. I would venture today that a 6kW PV system was about the same price as a 3kW system in 2006.

  • Pingback: Solar Homes Sold 20% Faster, and for 17% More, NREL Study Finds - Solar Energy USA

  • http://www.daylightgifts.com Daysi – DaylightGifts.com

    I agree with the fact that solar PV and solar thermal systems should be included in the price for all new homes, because it leaves less decisions for the customer to make and more savings in the long term.

  • Martin Steele

    In my opinion, I think it only a matter of time before the availability of renewable energy sources will become a greater selling point for residential sales than many other factors, such as new kitchens or bathrooms.

  • http://www.calsolareng.com California Solar Engineering

    The reasons to go solar just keep mounting and its becoming just silly to let another day go by wasting money to the electric company.

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  • http://docsgreen.blogspot.com/ Doc Wheat

    The study you link to is dated December 2006. Might these results be a bit out of date?

    • http://cleantechnica.com/author/susan Susan Kraemer

      It is the only large-scale study that has ever been done comparing sale speed and price among otherwise identical homes. I don’t think there have been too many opportunities since the great depression to re model that.

      No, I don’t think a study of those results goes out of date.

      It was serendipitous in that a solar evangelist joined the home building company and got solar on about half the model homes, as demo, and the NREL study discovered that if it was already on the home, it hastened sales speed, and raised sale price, and best (from my POV) raised the level of adoption of solar among people who normally don’t go solar.

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  • http://www.solarhotwater-systems.com Dr. Ben – Solar Inventor

    In the mid ’80s, I worked with a builder who decided to include solar energy as a standard feature in all of his homes. He ended up building seventy homes in Jacksonville, NC, about twelve homes in Rome, GA, and five or six in Chapel Hill. Each house has passive and active solar systems. The passive solar system provides space heating during the day and the active solar system provides space heating and hot water in the evening or whenever the passive was spent. Some of these homes had solar fractions as high as 80%!
    During this time, solar thermal systems were becoming accepted in the housing market as standard equipment. The market was maturing with proven technology. Unfortunately, the federal government pulled the rug out from under us by repealing the solar tax credits. Most of the marketplace collapsed as a result.
    Europe was going through some energy problems of its own but continued to push for energy conservation and solar energy. To my understanding, Germany has mandated solar hot water systems on all new construction. Europe is now way ahead of the US in the adoption of solar therm systems and is selling their equipment to us.

    Let’s get it right this time!
    Dr Ben

    • http://cleantechnica.com/author/susan Susan Kraemer

      Great story, thanks!

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