The Sunny Side Of Real Estate

As they are shown around properties, potential buyers in New York City can come up with a whole range of questions that brokers really need to have answers for. Too often we hear the buyer has been short-changed; the broker says the first nonsense that comes to mind or says he or she will ‘get back to them’ but never does. To give a potential buyer as full a possible set of answers to their sometimes – let’s face it – bewildering set of questions might not be what clinches the sale. However, to serve our clients we should have as many answers to hand as possible. Today more and more owners in NYC and the Hamptons are adding solar panels to their properties, so it is something that brokers need to be clued up on. Buyers will expect to hear something about costs, savings and maintenance of solar panels from the real estate broker just as they would expect to hear about mortgage protection from the mortgage broker.

Why New York?

Solar power is on the rise throughout the US. According to the Solar Industries Association, more solar installation took place in the third quarter of 2011 than the whole of 2009. As one of the 25 cities designated by the Department of Energy as Solar America Cities, New York City receives special support and incentives to increase solar power initiative. In addition, Mayor Bloomberg’s long-term sustainability plan, PlaNYC, recognised that while solar and wind generation was unlikely to play a big role in New York in the short term, it could and should play an increased role. With this impetus, financial incentives and a yen for green, many commercial and residential property owners have turned solar.

How do they work?

There are two types of solar energy that commercial and residential properties can generate: photovoltaic and thermal. Photovoltaic (PV) technology harnesses sunlight using solar cells made from semi-conductor materials. During daylight hours they convert sunlight to electricity by absorbing photons of light and converting them into electrons. Another key word for brokers would be ‘array’, which is the term for the arrangement of panels on a building. With solar thermal energy, flat panels or tube collectors are installed usually on the roof to heat fluids.

What’s the deal?

Many of the financial incentives such as federal and local tax credits relate to installation. The Pratt Center for Community Development says that “financial incentives from NYSERDA [New York State Energy, Research and Development Authority], the federal government, and others can cover as much as 62 per cent of the costs of installation and in some cases more”. Installation breaks, of course, are unlikely to benefit a buyer where a solar system is already installed.

However, buyers of properties in New York City with panels already installed will be interested to hear that they are entitled to property tax abatement. The Department of Buildings deals with applications, which must include maintenance plans. With all the support available to New Yorkers at this time, planning maintenance and finding qualified professionals is not a problem.

Buyers of properties with panels already installed will also be interested to hear that the energy generated can seriously cut heating bills. For example, the Pratt Center says that thermal system will typically provide 50-80 per cent of residential hot water. Furthermore, by selling back the excess energy that they generate, panel owners have a further financial incentive.

The topic is hot. Possible mayoral contender and Manhattan Borough President Scott Stringer has criticized Bloomberg for “moving slowly”. A report he just released says solar panels on schools alone could increase solar capacity in New York City by 2,500 per cent – the equivalent of planting 400,000 trees – and create 5,423 jobs.

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