This research explores the techno-economic potential for a predominantly renewable electricity-based microgrid serving Ethiopian residential real estate buildings, the fastest-growing sector. A stand-alone photovoltaic (PV)-Battery energy storage system (BESS)-Genset (PV-BESS-Genset) connected microgrid model, utilizing measured solar irradiation data, real-time manufacturer data for technology components, case study area daily energy consumption data, and a bottom-up approach to model demand response. The modeled system results in a $ 0.298 cost of energy (COE), reduces the 2000.34 kg/yr amount of CO2 released into the environment, and yields 1,470 kWh/yr of excess energy, which indicates that the system is the most cost-effective, ecologically friendly, and reliable, respectively. Moreover, solar PV production potential is very high onsite and can meet the onsite demand with a renewable fraction of 99.3%. However, BESS and generator production potential is substantial and provides a more balanced supply that can supply electricity when solar PV production is insufficient. These results can help to develop rules for residential real estate villages to generate their own electricity needs, distribute residential real estate's current grid energy share to other underserved areas, and lessen the issue of power outages. In an original test case, HOMER software was used to build a microgrid system based on renewable energy (RE), with the single objective of minimizing the net present cost (NPC), and MATLAB/Simulink for energy management. Thus, the system could be a benchmark for new roof-mounted solar-based technology for residential real estate buildings in Ethiopia.