Making the decision to buy solar panels is a big one. The right system could help reduce your energy bills and better the environment. Yet, many people wonder what may happen when they go to sell their homes later. Do solar panels increase home value? That’s a big question and one that really depends on multiple factors.
How Much Do Solar Panels Increase Home Value?
Installing the best solar panels for home use on your property could increase the value of your home by a significant amount. Many property owners will see a boost in home value should they go to sell their home in the years after installing it. The amount of increased value depends on multiple things.
Studies have shown that people will pay more for a home that has solar panels and a solar power system than one that does not. The amount depends on many factors. Generally, homes with solar installations sell for about 4.1% more (according to Zillow) than those without. Solar panels on homes are a valuable investment, and many people want to benefit from them but do not want to put out the initial dollar investment into them. Buying a home with solar already installed, though, is financially savvy.
How Do Solar Panels Increase Home Value?
Solar panels are more than just eco-friendly options; they’re a wise investment for your home. Research from the National Renewable Energy Laboratory shows a significant increase in home value linked to energy savings from solar systems. For instance, a $700 yearly saving could boost your home’s value by as much as $14,000.
The real estate market reflects this trend, with a 2021 Zillow report indicating a strong buyer preference for energy-efficient homes. Homes equipped with solar panels are not only in demand but may also command higher prices. In fact, buyers are often willing to pay a premium for solar-powered homes, with an average increase in sale price by about 4.1%. This value surge can be even more pronounced in specific markets like New York, where solar homes have a distinct edge over non-solar homes in sale price.
By integrating solar panels, homeowners can tap into this growing trend of energy efficiency, potentially leading to a more lucrative sale when the time comes.
What Factors Influence the Property Value of a Solar Home?
The key to remember is that every home is different. How much value do solar panels add to your home? That depends on multiple factors. Things like how much you are currently paying for electricity, location, and the overall age of the system could play a role in what the system is worth to the next person buying your home. Here are some of the most common things to focus on to better understand the impact solar panels have on your home.
Location
Solar panels are more valuable in some areas than others. For example, communities where there is a significantly higher amount of solar energy through direct sunlight typically get the best bang for their investment. In these areas, homes can generate more or all of the energy they need from solar, reducing costs otherwise. Also, some markets simply are more demanding of eco-friendly alternatives to solar power.
According to the Solar Energy Industries Association, there are 10 states that have the biggest benefit from solar, and in these areas, home values are likely to be more impacted when solar panels are on the home.
- California
- Texas
- Florida
- North Carolina
- Arizona
- Nevada
- Georgia
- New Jersey
- Massachusetts
- Virginia
That doesn’t mean if you live in another state that solar will not be a viable and beneficial option. It very much could be. How much value do solar panels add to your home, then? You’ll need to learn a bit more about the local real estate market and the number of property owners with solar panel systems who recently sold.
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Electricity Rates
Electricity costs in your area factor into the value of a solar panel. The more expensive it is to use electricity in an area, the more valuable solar panel systems are. The key benefit of solar panels is that they eliminate or reduce your reliance on solar panels.
Solar panels can be used to store power in a battery system. That means when the sun goes down, your battery can continue to power your home. That makes them less dependent on electricity, reducing your need to pull from the grid.
If you live in an area where the cost of electricity is high, this is going to be a desirable feature for potential home buyers. That includes areas like California, Colorado, and Florida. Take some time to compare your electricity costs to those in another state. You’ll see just how much of an impact this could make on your purchase.
Age of the Solar System
Today’s solar systems are designed to last. Some are able to last 20 to 25 years, but others are up to 40 years. During the early years, the system was newer, and that means it has more life left in it than an older system. For those who are considering the purchase of a home, a system that was installed less than 5 or 10 years ago is great because it means it has most of its life to go. A system that’s over 25 years old may no longer have the same boost to a home’s value.
Solar Panel Ownership
Owning solar panels outright can significantly increase your home’s value. This is especially true when purchased from companies like ours that don’t place a lien on the property, ensuring a hassle-free transfer to future buyers. Conversely, leased solar panels may be less beneficial to home value, as they come with transfer agreements. Our approach, which avoids putting a lien on your property, offers a clear advantage, enhancing the appeal and value of your solar investment.
How Do Solar Panels Affect Property Taxes?
An important consideration is the effect of solar panels and power batteries on property taxes. While installing a solar panel system can enhance your home’s value, this might raise questions about potential tax increases. However, it’s worth noting that some states have laws preventing such tax hikes due to solar installations.
Additionally, the inclusion of a power battery system, such as a Tesla Powerwall, can significantly boost property value. These batteries provide enhanced energy independence and efficiency, making them a highly attractive feature for modern homes. As with solar panels, it’s advisable to check with your local taxing authority regarding how these additions might influence property taxes in your area.
Are Buyers Looking for Homes with Solar Panels?
This really depends on your area. Many people are interested in solar panels, and some may not be willing to buy a home unless there are panels on it. Yet, most people do not buy solely because the home has a system in place. It’s a nice added feature in some areas.
Are You Ready to Learn About Solar Panels for Your Home?
The best solar panels for home use can be well worth your investment. Take a few minutes now to find out how easy it can be to install them. Ask us about the cost of installing solar panels. When you contact us, or fill out the form below, we’ll be happy to set up a consultation for you.
