With decades of reduced energy bills, a solar installation is an eco-friendly asset that can increase your property value in the right set of circumstances. In this complete guide, we explore the relationship between solar energy savings and property value to help you make the wisest possible financial decisions for your current or future home.
The impact of a solar installation on property value
Several studies have shown a correlation between solar energy installations and higher property values, including a that found homes with solar panels sold for an average of 4.1% more than those without. A similar study conducted by SolarReviews calculated that homes with solar sold for than those without in 2024, at a median margin of just over $25,000.
Why does solar increase property value?
Solar installations can increase your property value for several reasons, including financial benefits, energy security, and environmental sustainability.
Solar energy savings
Solar energy systems can enable long-term savings on electricity bills for 25 years or more. With reduced monthly expenses and protection against future rate increases for those living on-site, these savings can directly increase a property’s value and real estate listing price.
Energy independence
With sustainable electricity generated on-site, solar panels offer an alternative to grid-supplied power. Solar panel systems with battery storage allow for the most possible energy independence, with the ability to produce and use solar electricity “off-grid” and during local power outages.
Sustainable development
Installing solar panels can position your property as an eco-friendly investment and practical solution for the future of home energy. Keeping electricity costs and carbon emissions low, solar systems can integrate seamlessly with electrification upgrades, storage batteries, EV chargers, and smart home energy controls.
Solar ROI and property value
Environmental impact and energy independence aside, savings on utility electricity expenses are the key driver of increased property value from a solar energy system. By understanding how solar return on investment (ROI) works, you can make an informed financial decision as a homeowner considering a solar installation or as the buyer or seller in a real estate transaction.
More than anything else, it's important to know that while purchasing a solar energy system can significantly boost property value, leasing solar panels does not necessarily offer the same benefit. With a lease, you do not own your solar energy equipment, and therefore it does not directly increase the value of your property. On the contrary, solar leases may complicate a real estate sale if potential buyers must inherit an agreement with future payments required.
If you are a PPA or leased solar customer, you may be able to purchase your system before selling your home, boosting its property value and ensuring a smooth transition to energy independence for the next homeowners.
Calculating solar energy savings and ROI
The financial benefits of solar energy vary for every installation and home. To calculate your home’s solar energy savings potential and ROI, .
While every installation is different, most solar energy projects have a between 4 and 12 years, which represents the moment in which accumulated electricity bill savings reach total system costs. With a break-even point of 10 years or less, many solar energy systems can “pay for themselves” several times over when high-quality equipment lasts 25 years or more.
Increasing solar energy savings to boost property value
Whether you are building to sell or upgrading your “forever home,” there are several things you can do to increase your solar energy savings and boost property value. Critically, most of the factors that influence the performance and ROI of your solar energy system are determined prior to your installation, so proper planning is essential before jumping into anything too quickly.
Energy incentives
Depending on where you live, you may be eligible to reduce your total investment costs through several solar incentives. While local and state incentives vary across the country, many homeowners qualify for the , which is a federal income tax credit worth up to 30% of solar energy installation costs.
High-quality equipment
Industry-leading hardware like ţţ淨r IQ Batteries are built to maximize system efficiency and optimize solar production, storage, and use. In the same sense, ţţ淨r IQ Microinverters last longer than alternative technologies, with multi-decade guarantees to ensure long-term savings.
Local expertise
For solar energy systems, property valuations, and real estate transactions, a local expert on your side can help create the best possible outcome in any scenario. Connect with us and in your area.
Key takeaways
In short: Yes, a solar installation can increase the property value of your home.
Beyond offsetting greenhouse gas emissions from other fuel sources, a solar energy system can increase the value of a home that’s for sale or rent with reduced utility bills and increased energy security on-site. While utility bill reductions and property value boosts vary for every project, investing in high-quality equipment and partnering with certified professionals can ensure maximum system efficiency and lifetime savings.
FAQs
Will solar increase my property taxes?
With added value during a home appraisal, a solar energy installation could potentially increase your property taxes unless barred by local regulations. In 2024, the added value of a in 36 states.
Is it harder to sell a house with solar panels?
No, it’s not usually harder to sell a house with solar panels. According to this article by Forbes, National Renewable Energy Laboratory that homes with solar panels sell 20% faster than homes without. With that said, if you enter a solar lease, you may need to transfer the contract to the new homeowner or else buy out your agreement prior to a home sale.
Is solar a good investment for resale value?
Yes, in general, solar is a good investment for the resale value of a property. Solar energy systems are designed to create financial savings that exceed their initial cost. Knowing this, the added value of a new solar energy system may be equal to or greater than the total price paid for the installation after rebates and incentives are applied.
Note: This article is written for educational purposes and is not financial, legal, or tax advice.
