Solar power is becoming a major real estate trend, as cities, states, and the federal government all strive to lower their areas’ greenhouse gas emissions. The U.S. Energy Department notes that rooftop solar costs been halved since 2014, and system installations are surging across the country. Sunrun and SolarCity (now part of Tesla) are leading that growth.
Climate-connected reasons aren’t necessarily in the forefront of homeowners’ minds when they go for it. A lot of the impetus involves blackouts after storms. Households seeking independence from overburdened grids are looking to generators, wall batteries, solar panels and tiles.
Empowered Households
The February 2021 Texas freeze was the last straw for some. Interest is home solar power systems spiked in the midst of the long, life-threatening outages. Indeed, blackouts are becoming increasingly common challenges for homeowners across the continent.
Home buyers are, in a sense, taking back their power. A home buyer at Alset EHome’s Northpark community in Texas receives battery storage and car charging equipment — and even a Tesla car. The draws for buyers are multifaceted: freedom from overworked power grids, lowered household costs over time, climate awareness, and the sense of being early adopters of high-tech energy sources.
Tesla Energy and Dacra are working with Brookfield Asset Management on a new development in Austin, too. Brookfield Asset Management has announced the project as “the nation’s most sustainable residential community.” Solar-forward housing developments could funnel surplus energy into the areas around them, creating major solar hubs.
Incentives for Home Solar
Solar panel systems can reduce household electricity costs while supporting reliable, uninterrupted power. Sweetening the deals still further are rebates and incentives for making the solar shift.
In addition to manufacturer rebates on some home systems, there are various state and city renewable residential energy credits (they vary, depending when the buyer makes the shift), and the federal tax credit — a 26% break on the price of installation.
Home solar systems can fully pay for themselves in a few years. Granted, much depends on the state where the home is. States are still all over the place with their approaches. Solar incentives vary even within states — for example, among New Jersey homeowners.
In some states, such as Virginia, utilities companies must offset their carbon emissions, so they buy Solar Renewable Energy Credits (SRECs) from solar power producers. Homeowners can get in on this, and augment the returns on their solar investments. Sometimes solar incentives lose steam. Although California law sets forth state residents’ rights to use solar power, in March 2021, the state faced a proposal from utility companies to pay less to rooftop solar owners, alas — and to add a new fee for connecting the systems.
What about the heroes of our story? For the residents of Peoria, things aren’t looking so sunny. In 2016, Illinois passed the Future Energy Jobs Act, lowering home solar costs by thousands of dollars. Great! Except that the law was underfunded, and state incentives crumpled in the face of resistance from fossil fuel companies. Illinois funding woes also mean layoffs for solar technicians statewide.
Restrictive Covenants Versus Solar Access Rights
Can people who own homes and condos in homeowners’ associations (HOAs) go solar? That is, can a unit owner place solar panels on “common elements” of a multi-unit property?
Some association say panels mar the aesthetics of the buildings, so they’re ruled out (although tiles might be acceptable). Some delegate the call to the architectural review groups. Some HOAs argue that property values will be impacted when owners start installing solar panels. (This is not a strong argument, in light of the U.S. Energy Department’s observation that renewable electricity raises a property’s value.)
Virginia got out ahead of the arguments in 2020, forbidding HOAs or architectural review boards from making owners remove or reposition their solar panels if the change diminishes power or raises homeowners’ costs significantly. Oregon residents have had the right to solar access since 1979. Today, more than half the states ensure solar access. This means associations and boards may not prohibit homeowners from using solar energy systems. (Owners might still need to apply and follow reasonable direction from boards before going ahead with installations.)
So, a condo buyer should look into a few questions before planning to go solar:
- Does the state have a solar rights law, preventing the need to butt heads with the association or review board?
- Does the development have deed rules, covenants, or restrictions could get in the way of installation, cleaning, repairs, replacement or removal of the home solar equipment?
- Who covers roof maintenance costs? Are they higher for owners with solar panels?
- Is there an allowance for solar easements, so the system can work to its full potential? For example, other homeowners might need to avoid obstructing the sunlight that hits the solar panels. An easement can ensure a lasting arrangement.
Wisconsin’s laws bar subdivisions from placing any significant restrictions (other than a permit application) on the installation or use of wind or solar power, assuming there are no public health or safety issues. Wisconsin law voids such restrictions, and also exempts owners of renewable energy systems from taxation on a system’s value. South Carolina is also working on legislation to make HOA anti-renewable deed restrictions void.
In contrast, the Community Associations Institute (CAI) “opposes government and interest group efforts to override community policy or deed restrictions on single interest issues” and insists that condo associations are “the best mechanism to enact sustainable environmental policies.” So, if the state doesn’t have a strong set of provisions for renewables, buyers should anticipate arguments from associations that don’t give solar roofs affirmative support.
Pro tip:You’ll likely find the greenest policies in states that let jurisdictions prohibit HOAs from obstructing home solar installations. They’re listed on the Community Associations Institute website.
Covered by Homeowner’s Insurance?
Rooftop solar systems can run into the five figures. In the unusual event of damage to the system, homeowners might understandably ask if insurance covers the costs of repair or replacement.
Many homeowners’ policies do cover solar equipment without the need for adding coverage. Rooftop panels or tiles are often deemed permanent fixtures, and might have no claim limit.
Pro tip: Ask your agent about what parts are covered, what deductibles may apply, and what types of damage is excluded. Learn how to get the most from your policy before deciding on a system that meets your needs.
Many Reasons to Consider Home Solar
Achieving serious reductions in home-generated greenhouse gas is just one (very important) reason to adopt solar power. As you can see, solar power does have quite a few more points going for it.
State laws are helping homeowners who wish to move in a solar-forward direction. Activist groups are also trying to push renewables (and homeowners’ rights) forward. Still, legislation at the federal level would be the best support for access to solar systems for homeowners who live on HOA properties.
Supporting References
Sarah Bowman for the Indianapolis Star: Can an HOA Stand in the Way of a Homeowner Who Wants to Go Solar? (updated Mar. 11, 2021).
Dan Gearino for Inside Climate News and Brett Chase for the Chicago Sun-Times: Home Solar Demand Plunges as Illinoisans Can’t Tap Incentives Amid Standoff on Energy Bill (Aug. 20, 2021).
Brian Eckhouse for Bloomberg Green: Sunrun’s CEO Is Selling Peace of Mind With Her Rooftop Solar Panels (Apr. 7, 2021).
HOAManagement.com: How to Have Solar Panels in an HOA Community (undated).
The Community Associations Institute (CAI): Solar Rights and Easements (undated).
Daniel Miske for HuschBlackwell.com: Association Alert: Solar Panels – What Your Association Should Do When Someone Requests to Install Them (Feb. 24, 2021).
Nationwide.com: Solar Panel Insurance (undated).
Photo credits: Gustavo Fring and Vivint Solar (Sunrun), via Pexels.