Can Solar Increase Your Property Value?

The real estate market is hot right now and it’s affecting the solar industry.  Within the last year, we’ve received numerous inquiries from new homeowners and sellers about what will happen if you decide to sell your property shortly after installing a solar system. Fortunately, you don’t have to use your solar panels to see their value.

A recent study conducted by Zillow found that on average in the United States, homes with solar systems sell for 4.1% more than their solar-less counterparts. These percentages vary based on your state, with New York, NY boasting a 5.4% increase, whereas Riverside, CA a 2.7% increase. This study helps reinforce Berkeley National Laboratory’s 2015 study that on average, each watt of solar can add $4 to your property value in the U.S. Since solar systems are rated for 25-30 years, a brand new system on a house will have the most impact on property value. Check this out, if your utility bills average $200/month, you’d be most likely to install a 13kW solar array, ranging from $25,782 – $32,997 out of pocket.  Let’s say you get that dream job and you now have to move, so you want to sell your home.  The good news? Your property is now worth at best, 26% more than without solar and at worst, $4/watt or $52,000

What if the solar array on your home was installed quite a while ago? Doesn’t the 25-year warranty on the modules also make for a lifespan on the property value boost? Yes and no. In some cases, educated prospective home buyers will question every aspect of the system, and may determine it isn’t worth the added cost. However, since these systems last for decades while degrading very slowly, even an old system can produce most if not all of the energy the home needs. There are also societal forces that could be driving these property value increases.  For example, we have seen in some luxury markets and 2nd home destination real estate markets, that homes with solar can sell for as high as 26% more than homes without solar.

The reality is now that both homeowners and homebuyers are quickly seeing solar about to go mainstream as a tremendous value add. Many prospective home buyers already see solar as an asset, despite the system’s age, as it is a fixture to the property and it will generate at least a piece of their energy needs, and help offset their carbon footprint. Eventually, as we are seeing happening in CA, all new construction will be required to have their own forms of clean energy generation.  So why not get ahead of the curve, save money now, and re-invest in your home with solar? 

Sources:

Sarah Mikhitarian on Apr. 16, 2019. (2019, April 24). Homes with solar Panels sell For 4.1% more. Zillow Research. https://www.zillow.com/research/solar-panels-house-sell-more-23798/.