Homes are Worth More with Solar Panels
It seems like common sense that homes with solar panels installed would be worth more in any housing market. Solar panels reduce energy bills, create more sustainable energy and last for years—what’s not to like? However, until recently, there wasn’t definitive proof that solar panels resulted in added home value.
In 2015, the Orlando Lawrence Berkeley National Laboratory released a study asking an important question: are homes with solar panels really more valuable than homes without them? And, as you might imagine, the answer was yes!
The study was supported by the U.S. Department of Energy and also had help from the National Association of Homebuilders and the California Energy Commission. It spanned eight states and was conducted over ten years, 2002-2013, meaning that it included data from the housing boom, bust, and recovery. It studied over 20,000 homes, with nearly 4,000 homes that included solar panels. Even the New York Times acknowledged the study’s significance for home appraisers and buyers.
This research looked at all sorts of homes, valued from $165,000 to $899,500, with an average value of $473,373. The average home included in the study was also 2,334 square feet, on roughly half an acre of land, and was built near 1993. The average solar panel system on these homes was about 2.7 years old.
The average home in the set of data without solar panels was similar in size and age—but was valued at about $456,378. That’s nearly $17,000 less than homes with solar panels!
Interestingly, solar panel premiums stayed consistent throughout the housing market upheaval of the 2000s, suggesting that solar panels are a constant, reliable value even when everything else is up in the air.
Not only were homes roughly $17,000 more valuable with solar panels, but the study showed definitively that buyers were willing to pay a $15,000 premium for homes with solar panels installed. These buyers were likely considering the long-term positive effects of their purchase: dramatically reduced electric bills for the foreseeable future, and an added value to their home that would unlikely to depreciate if housing markets were in trouble.
In the end, solar panels are a wise addition to any home, and especially with government incentives and future savings, their worth is often far above their cost.