Solar panels can be a great way to reduce your utility bills while making your roof work for you. If you’ve got rental properties, solar energy can be a boon for your tenants — not to mention the incentives you’ll qualify for in many states. If you’re considering adding solar to your rental properties, here are a few things you should know before you get started.
First, Consider Your Property
What kind of property do you own? Installing solar panels on a single-family home is a fairly straightforward proposition. For multifamily properties, it can be more complicated. It also depends on whether your tenants pay for their own electricity, or if it’s included in the rent.
Even if you include the electric bill in the rent, installing solar panels on a multifamily property can help reduce your tenants’ costs, which they’ll probably appreciate. If you’re living on the property, it can be of benefit to you, as well.
Buy, Rent or Lease?
Now that you’ve decided to install solar panels on your property, will you choose to buy, rent or lease your panels?
Buying the panels requires a higher initial investment, but it also provides you with access to solar incentives at both the state and federal levels. These incentives also apply to solar panels purchased with solar loans, which you can obtain through your bank. There is also the possibility of third-party financing for commercial buildings, which has developed over the past 5 years or so.
Leasing solar panels is also an option — you can reap the benefits of solar panels without the large initial investment. You will not be eligible for the tax incentives, though — the company you lease your solar panels from will instead receive those incentives.
Finally, you do have the option to rent your solar panels — the company you rent from owns the panels and maintains them, for a modest fee.
It is important to note that there are some states, like Florida, where you cannot lease solar panels, so your only option will be renting or purchasing your panels.
Talk to Your Tenants
While the final decision is yours when it comes to installing solar panels on your property, taking the time to talk to your tenants can give you a good idea of their opinions about solar energy. You may even have tenants approach you to discuss the possibility of installing solar on the property they’re renting. Don’t dismiss it out of hand if they do ask you — it might take a large investment on your part, but it can potentially pay for itself.
Benefits of Solar
Solar energy has several benefits, beyond saving money on your energy bills.
- Solar panels increase the value of your home. The Department of Energy found that after an owner installed solar panels, the average home increased in value by $17,000.
- Solar energy is a long-term investment. Most solar panels are designed to function for 20 to 25 years, and many are guaranteed to perform at 80 percent efficiency for more than 25 years. Chances are, if you own your property for 30 to 40 years, you’ll still be getting plenty of energy.
- Solar energy reduces carbon dioxide waste. Over 20 years, solar panels can reduce a home’s carbon dioxide emissions by nearly 100,000 pounds.
- It’s easy. Once you’ve installed the solar panels, you don’t need to do anything but sit back and rake in the savings.
If you’re worried about the aesthetics of solar panels on your roof, consider the new Tesla solar shingles — no one will ever know you’ve got solar panels when your roof is made up of hundreds of little solar shingles.
Rental properties don’t have to be left behind when it comes to green energy or solar panels. Solar can improve the value of your home, decrease your utility bills and improve your overall property appearance. The initial investment might be high, but the money you’ll save definitely makes the panels pay for themselves.