Investing in solar panels for your home is a great way to do something good for the environment, and save a bit on your energy bills in the process. There are other benefits that come with using solar panels too, in fact, such as gaining some degree of energy independence and improving the perceived value of one’s property.
That said, buying and setting up a solar array can be a costly affair. As a result, many believe that despite solar's many virtues, the presence of panels causes unnecessary complications once the selling process begins. Thus, the question isn't do solar panels increase the value of your home, but are they worth the logistical headaches that might ultimately ensue?
Do solar panels increase the value of your home?
Yes, solar panels will absolutely increase the value of your home. An average-sized solar array can add an additional $15,000 to the cost of a modern home. According to the Office of Energy Efficiency and Renewable Energy (EERE), people are more than willing to pay that and more, in some cases. According to Greenlancer, energy-efficient homes have historically sold faster and for more money than those that did not have attached solar arrays.
In 2018, that difference equated to an average of around 4.1 percent. However, that price difference was not the same everywhere. For example, homes in Riverside, Calif. came in at about 2.7 percent more, while homes in NYC were more in the realm of 5.4 percent. Homes in larger coastal cities such as Orlando, Fla. and San Francisco, Calif. usually fetched between 4.4 and 4.6 percent. Thus, the location of a home can seriously impact how much value solar panels might add.
Do solar panels ever lower property values?
There’s very little chance that solar panels will lower the value of your home, but even if solar systems add value to your home, this value can be undercut by a number of different factors. According to EERE, one of the reasons that solar-equipped homes tend to sell for so much more is that solar panels are considered upgrades to one’s home. And just like a pool or finished basement, the inclusion of solar panels represents a significant investment on the part of the homeowner.
If those panels are leased by the solar company or third party, the seller might have to purchase or return the equipment. If they purchase the equipment, it could put a lien on the house, which would not improve the price point at all. Local electricity rates and solar electricity prices could also affect the overall value that solar panels add to a home, as can the relative understanding of those looking to purchase the home.
If home buyers don’t understand the benefits of solar energy, they might see the panels as just another piece of furniture they’re going to have to replace or get rid of. According to Homelight, not every person sees solar as valuable, some see it as a hassle, and they don’t want the added responsibility of worrying about solar panels. Thus, the added value incurred by solar panels can only really be determined on a case-by-case basis.
What are the pros and cons of buying a house with solar panels?
The good news for home buyers is that even if solar panels up the price of your new home, their presence is definitely more positive than negative. Solar panels are generally considered a good return on investment, and since their upfront costs are usually much higher, having them already in place is not likely to incur any further investment above a raised asking price.
According to Solar Reviews, investing in solar energy is one of the best things you can do for the planet. They reduce electric bills and foster energy independence, though clearly they are not so great if you’re planning to move anytime soon. You’ll also want to inspect and/or service the panels before you move in to ensure that they are in good, working condition. According to the Gregory Real Estate Group, solar systems should be examined just as closely as any other piece of the home.
Check that no trees are obstructing sun exposure to the panels and make sure you request a full accounting of the array’s maintenance history. Finally, make sure to look into any increased property taxes that might have been incurred by the solar installation. Your tax bill will probably be higher, unfortunately. Still, at least you’ll be able to sleep soundly knowing you’re doing your part for the environment.