How does lack of alternative energy sources affect your property value?

It’s been years since households could fully rely on Eskom to deliver electricity around the clock. Most recently, the country suffered from stage 6 load shedding.

There were various reasons why Eskom had reached this loadshedding level including generation capacity constraints, sabotage and security the funds to meet the price of diesel. But that leaves households with very little alternative but to consider investing in other energy resources, particularly if they’re running businesses from home or working from home.

These alternative energy resources, like solar panels and generators can be very expensive. However, an investment of this nature could pay off when homeowners decide to sell properties on.

But how much of a deal breaker have these alternative energy sources become? Will it put buyers off a home if they aren’t already in place?

Regular households

Regular households that are not part of a sectional title may have some leeway. Some believe it won’t be a deal breaker for buyers as many know that, on average, households are struggling to get by – let alone afford the extras such as alternative energy sources for homes.

Kerry Bailey, Tyson Properties Umhlanga & Ballito principal points out: ‘The average man in the street – with his reduced disposable income – is hard pressed to spend it on the grudge purchase of alternative energy at this stage.

‘The common situation at some homes is a small inverter to see the household through two hours of load shedding, with the absolute basics of appliances and a few lights. Unfortunately, this is not sustainable if the electricity is off for an extended period.

‘The cost for a large inverter with lithium batteries is about R180 000 that will allow a seamless change over when the lights go off and allow the homeowner to have access to everything in their home except the oven and the use only one air conditioner.

‘To go completely off the power grid – so to speak – with solar panels as well is approximately R250 000.’

Sectional title properties

Chris Tyson, founder and chairman of Tyson Properties however argues that when it comes to sectional title properties, especially high-rise properties, alternative energy sources become a must.

‘You don’t want to be buying an apartment on the 20^th floor and the lift does not work during loadshedding. Complexes also need alternative energy sources for security and infrastructure.

‘If you are buying in a sectional title complex, apartment block or estate, it is important to ask your agent about alternative energy. The cost of the alternative energy is often covered by the body corporate and not an individual cost to the homeowner,’ he says.

High end properties

Whether high end buyers will be put off by the lack of alternative energy sources is also still open for debate. High net worth individuals will of course be able to afford such installations far easier than the man on the street so there may be a degree of expectation in the future.

‘We find there are some high-end homes that have all the alternative energy systems, but it is still to be seen whether this will be a reason for a purchaser NOT to buy a house if it is not installed. I think it is an added benefit in marketing the home, but we have not got to the point where is devalues the home or puts the buyer off purchasing.

‘I am sure that with continued black outs the demand for these will increase and ultimately be in the same realm as having an air conditioner – well certainly in KZN,’ says Bailey.

A worldwide problem

Energy is in short supply worldwide. There are many reasons for this including the supply issues and the war in Ukraine. However, South Africa’s domestic energy problems have been running for years but it’s only now that the government is listening for calls to change as energy supply becomes more desperate.

It’s resulted in the government turning to the private sector to find a solution to the country’s 14-year-old power crisis. There’s no telling yet how it will work and how a new incentive scheme to help households and businesses access solar power will work.

But while the government tries to hammer out a plan, it’s best to think about how alternatives could fit into your home’s future so as not to put off any potential buyers or to at least help increase the value of your home.