Are solar panels beneficial on rental properties in okc?

Question

Are solar panels beneficial on rental properties in oklahoma. We have a 26% tax rebate on the value of the panels. Do renters care about solar benefits, and can you charge more rent to offset the cost of the panels?

Eliott Elias · Answer

You can charge as much as you want. The truth is solar panels really don't make a difference. It doesn't increase the value of your home, and tenants don't care if the home has solar panels on it or not. It is a hindrance in most cases

Nathan Gesner · Answer

The tenant saves on their electric bill, but how do you pay for the cost? You would have to charge higher rent, which offsets the Tenant's savings on electricity. Even for a cheap $15,000 system, you could charge $100 more a month and spend 12.5 years just to break even (assuming no additional costs are incurred, like maintenance). Even on your personal home, you can expect 10 - 20 years before a solar system pays for itself.

You can find different opinions, but I've argued against solar on rentals for a decade or more. There are users on BP that are adamant supporters, but only 1-2 have shown numbers that appear to demonstrate a return on investment.

Cary Verner · Answer

In addition to what was said above, Oklahoma is not the most favorable state for Solar, as Oil and Natural Gas have a heavy hand in legislature. There are some companies that offer net metering, but many utility companies do not.

If it is a multi-family/commercial property that is not separately metered AND landlord pays utilities, I imagine there could be a way to create some savings. Those savings could increase your NOI. But for the majority of investors Solar isn't a value-add.

Bud Gaffney · Answer

@Christopher Fickess no. Too expensive.

Bill B. · Answer

Please just click on the magnifying glass at the upper right. This is literally skied monthly if not weekly. It’s not a good financial deal. If you raise rent you’ll get less applicants as they are screening by rent. Either you plan to charge what the utilities would be anyway and the tenants don’t benefit at all, or you’re going to charge below utility rates and take 20 years to “break even”. Maybe you want to give me a million dollars and I’ll give it back to you in 20 years so you break even.

Adam Martin · Answer

Solar panels are something that take a while to put you in the green and are a long term investment. I am interested in getting them on my personal home at some point when prices come down more but not for any of my sfh’s. If you have a duplex or larger and are paying utilities it may make sense to get some return and utilities are on the rise. I don’t however think you could charge a premium for them though as few tenants would willfully pay extra over the normal utilities to help you recoup your expenses. If you have extra cash now and can’t think of anything that will give you a greater return than go for it but I’d prefer to put that money towards the next property.

Patricia Steiner · Answer

Before you install solar panels, please know that roofers will not remove or reinstall them should you have a "roof event." Most renters are more concerned about the rent price than saving on utilities. I would recommend making a cosmetic upgrade to the property rather than invest in solar. Hope this helps...

Cassi Justiz · Answer

It might make your home slightly more desirable than the average rental property, but the cost offset for the tenant isn't likely enough for you to increase rent to recoup the cost of the panels.

You also won't likely recoup much value on an appraisal or resale for solar in this area since it's still pretty rare (few supporting comps to show value) and the solar payments typically are pretty comparable (or more) than the average electric bill.

Are solar panels beneficial on rental properties in okc?

Are solar panels beneficial on rental properties in okc?

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