Without a doubt, solar panels are a “must-have” for any environmentally conscious homeowner. Furthermore, the savings on your utility bill means more money in your wallet.
Do solar panels add value to your home? The answer is yes.
In addition to lowering your carbon footprint and saving money, home solar can substantially increase the value of your home if you ever decide to put it on the market. If you are debating whether going solar is the right choice for you, it may delight you to learn that solar panels have another big benefit in addition to saving money as you take a step towards clean energy independence.
Solar panels increase the value of your property, making your installation truly a smart investment. On the other hand, it makes a big difference if the solar panels are owned or leased. Be careful when choosing how you finance your installation because it might be difficult to sell your home if you have signed a lease agreement or have outstanding payments on the solar loan.
Let’s take a closer look at exactly how much value can be added to your property with rooftop solar.
If you’re thinking about selling your solar home, you’d enter the market as an advantageous as buyers are looking for homes that can save energy and money while being gentle on the environment.
That being said, your property will be more attractive to potential buyers.
Moreover, from the perspective of a home buyer, you’ll immediately be reaping rewards on your energy bill without having to go through the hassle of installing solar panels in the first place.
Several studies show that installing solar panels can significantly increase the value of your home. Homes with solar panels sell for more money compared to similar homes in the neighborhood.
A recent National Renewable Energy Laboratory (NREL) study shows that homes with solar panels sell 20% faster and for 17% more than non-solar homes.
In addition, The Zillow report says solar panels increase property value by 4.1% across the U.S., which is $9,274 on average home prices.
According to the Zillow study, added value varies by region
The U.S. Green Building Council statistical analysis of home value showed that homes with solar sell for 8% more on average compared to similar homes without it.
Furthermore, Lawrence Berkeley National Laboratory released a study showing that homebuyers are willing to pay a premium of $15,000 to $20,000 for a home with an average sized solar panel system on the roof.
Let’s take for an example of a home with an owned 5 kW system.
The average size of a home solar panel system in California is 5 kilowatts (kW). If a home has a system of this size, it can generate around 5,000 watts of power at peak performance. According to the Lawrence Berkeley National Laboratories (LBNL) report, each watt of solar adds $4 of value while in other parts of the USA, about $3 of value is added per watt. Therefore, a homeowner in California can expect a $20,000 premium (considering an average sized system would bring an increase of $4 x 5,000 W).
Simply put, if a 2,500 square foot single-family home has a market value of $250,000, an identical home with a 5kW solar panel system can go for $270,000.
Of course, all of the above depends on the home location, the real-estate market and assumes that you already own the solar system. If you have a leased system, there are many environmental and economic advantages, but it can create unique challenges when reselling the home.
That depends on many factors such as: