Do Solar Panels Increase Home Value?
Perhaps one of the most common questions asked by homeowners who are considering solar panels is, do solar panels improve your home’s value? The short answer is: Yes, solar panels do increase your home’s value! According to research from the National Renewable Energy Laboratory, solar panels can add an average of $18,324 to the value of a medium-sized home. In addition, they found that homes with solar panels sell about 20 percent faster, on average.
Of course, determining if solar panels are right for your home’s value depends on several other factors. Below are some common considerations to take into account on the value solar panels will add to your home:
Financial Value of Installing Solar Panels
To get a better idea of just how much solar panels improve home value, EnergySage and Sandia National Laboratories conducted a study of home solar value in 15 U.S. cities. In the majority of cities, solar panel systems garnered increased home values of at least 80 percent of their price and installation costs. In comparison, EnergySage found that homeowners only saw a 68 percent return on investment after a major kitchen renovation. And as the price of solar installation continues to fall, more and more homeowners will find that they not only recoup their original investment, but actually earn more upon resale.
And just another way that solar is a safe bet: Homeowners need not worry about paying off their solar panel systems before selling their home. The bottom line home value increase, should you decide to sell, means you should be able to recoup your investment even if your system hasn’t paid for itself yet.
Why do solar panels improve home value? Just look at the cost of your energy bill. Your potential home buyers will be able to save so much on their energy bills that the increased home premium will be a no-brainer.
Will Solar Panels Add Value To Your Home?
The amount of value that solar panels will add to your home depends on several factors. An experienced, local solar contractor can help you determine if your home is right for solar, based on your roof’s orientation, shingle material, and shape. Other determining factors about solar panels’ value include:
Your Home’s Location
Installations in active solar markets typically yield higher returns than those in less developed markets. An active solar market is an area of the country that receives ample sunlight, has high solar installation rates and has local government incentives like property tax exemptions or energy rebates. The most active solar markets are California, Arizona, North Carolina, New Jersey, Nevada, Massachusetts, New York, Hawaii, Colorado, and Texas.
If you don’t live in one of the most active solar markets, don’t worry. With solar technology improving daily, more and more homes all over the country are having solar panels installed. There are also solar panels that operate efficiently during snow and cloudy weather. For this reason, solar panels are attractive home additions to potential buyers all over the country.
The Size of Your Solar Installation
Property value increases are directly proportional to the capacity (and quality) of solar panels installed. In order for them to improve your home’s value, the capacity of solar panels on the property should be proportional to the size of your home. For example, a 4,000 square foot home should have more solar panels than a 1,000 square foot home. Use our solar panel resources to see how large your solar panel system should be.
Will You Own or Lease Your Solar Panels?
Choosing to own the solar panels you install on your home, versus leasing them, is the best option to increase the value of your home. If you do choose to lease your solar panels, they may still add resale value. Show potential buyers the amount of money they can save by using solar, and you can possibly negotiate to add the leased solar panels to the cost of your home.
Curb Appeal, Warranties, and Other Concerns About Solar Panel Value
Many homeowners are interested in solar power, but have held out because of concerns about curb appeal. However, new innovations in solar panels are rapidly making them more visually appealing. Today’s solar panels are smaller, sleeker and offer increased flexibility of configuration. And depending on your roof’s pitch, today’s panels can appear barely-there. Another option, depending on the area of the country in which you live, are roofs with solar shingles. These solar shingles can blend into the architecture of a home and that of surrounding homes. If you have any concerns about solar panels and curb appeal, let your solar contractor know. They will likely be able to find an option that meshes well with your preferred aesthetic.
Homeowners also fear that they will be on their own if something goes wrong with their solar panel system. However, as with any major home renovation, you can allay those fears by ensuring your solar panels have proper manufacturer and installer warranties included. These warranties should give you peace of mind. And unlike other parts of your home, a solar panel system has no moving parts that will wear out over time, and they typically require little maintenance or repair.
In short, solar panel installation is an investment that will provide a significant increase in your home’s value. If you’re interested in reaping the financial and environmental benefits of a solar-powered home, our tools can help you get started.