Do solar panels increase home value?

UK Home Improvement

Do Solar Panels Increase Home Value?

Switching to solar-powered energy systems from traditional systems has been a trend in recent years. Savvy homeowners are turning their residences into power-saving powerhouses- where your house is soaking up all the sun rays through solar panels and literally powering your coffee maker for that fresh pot of coffee in the morning!

Whether you want to save the environment or save your electricity bills, solar panels can help you achieve both. While investing in solar panels may sound like a lot to do, you will start seeing positive results within a month or two. But do they increase home value? 

While the answer is yes, there are a few more factors that need to be considered to determine the extent of this value increase.

Do Solar Panels Increase Property Value?

“Investing in solar panels pays for itself”- has been the strongest debate about this renewable energy. 

It can significantly reduce your energy bills, so any upfront costs are paid back. Also, customers can expect an ROI of at least 2-3 times over the life of the system.

However, those numbers assume you live in that same home during the entire warranty period, which isn’t always the case. Also, most people back off from investing thinking that they may not live in that house long enough for that particular up-front investment to pay off.

This report shouldn’t scare you if you own the home. Installing grid-tied solar energy systems can enhance property values, offering an exciting selling point for real estate agents.

Even if you’re not living in that home for long enough, premium buyers will be willing to pay an amount that will be more than the amount you invested.

Solar Homes Sell For More On Average

A study was conducted on  22,822 homes in the US to determine how solar power systems impact home resale value. 

It compares the sale price of 18,871 non-PV homes to the sale price of 3,951 PV (photovoltaic) Homes. 

The result concludes that houses with solar power have an increased home value by £11,274.69 – or 3.74% more than their non-PV counterparts.

The average system costs between £7,500 and £14,000 in materials, so homeowners can expect to regain the materials cost when they decide to sell the house. This is more than the savings they are getting from tax incentives and reduced energy bills that can pay for the system 2-3 times over the life of the warranty.

The best part is that some states may not count the PV systems when calculating property taxes, thus saving you a lot of money.

Digging Deeper Into the Data

You will never know the whole story from average data since real estate is a complex market. Let’s discuss the data and see if we can uncover a few more details.

Diminishing Returns on Larger PV Systems

The study found the existence of a “green cachet” for solar-powered homes. Regardless of the wattage output of the system, PV-equipped homes sell at a premium price. The increased sale price of homes with more powerful PV equipment wasn’t proportional to the installation cost of the solar system

According to this study, the buyers are willing to pay more for owning a “solar-powered” home. The efficiency of the system or its ability to cover their expected energy usage has no impact on their willingness to buy.

For sellers, it would be wise to install solar panels through trusted solar panel installers on the home before selling. They can install a modest grid tie system that depends on stored solar energy most of the year but pulls the power from the energy grid when it’s time for heavy usage, like when the HVAC runs on full blast. 

Doing so may give you the flexibility of listing your home as a solar-powered one while keeping the installation cost down. And when the sale goes through, you can turn a profit on the system.

Solar Homes May Take Longer to Sell

As a seller, taking an extra project like turning a home into solar solar-powered one may take time, labor costs, and risk of sales. It may not even be worth the effort since PV-equipped homes take longer to sell.

The study finds that solar-powered homes may take an extra 8 days in the market before selling, compared to their counterparts.

However, based on which state you’re in the extra number of days may vary.

Small sample size in some states

In some states, the sample size was quite small to provide accurate data. Only the numbers from CA were closest to the national average, considering its data is much more robust than other states of the country.

Incentives vary by state

In some states, the incentives for buying a solar home are quite lucrative, while some states offer nothing.

Without the incentives for owning a PV-equipped home, these homes may decay in the market for a longer period. On the other hand, if you are offered a break on property taxes for owning solar-powered homes, you will be more interested in investing in one.

Before investing, you need to do some research on state solar incentives to make sure you’re in the right place for such investments.

Local perception of solar

Solar power has been widely used in places where sunlight is plentiful and where state government is providing strong incentives for owning such homes. There are also some other states where they lack knowledge and proper equipment for going solar.

Also, there are areas where electricity bills are low with poor to no benefits for solar adoption. In that case, the possibility of creating awareness for solar-powered energy will be very low. It will be really difficult to convince the buyers that investing in a solar-powered home is wise since they won’t even understand its long-term benefits. 

In lower adoption states, solar education can be a major obstacle. In some cases, you may have to struggle to make the buyer understand the difference between grid-tie and off-grid systems.

Besides, there is a huge risk of unwanted accidents if the buyers aren’t properly educated about the solar-powered energy system. If the solar array goes out and they don’t know how to fix it, they will be stuck without power for a longer period.

However, it shouldn’t be a major problem since most systems are grid-tied and the grid can pick up the extra electricity during heavy usage. And if the power goes down, there are public utility workers who can fix the issues before the homeowners even know.

Regardless of the situation, educating the buyer about the solar-powered home is crucial to convince them that it’s a reliable way to power their home.


In the world of solar-powered possibilities, the question may still arise: Do solar panels really raise the value of your home?

The answer is a resounding yes! However, some factors need to be considered.

Not every solar house people own can be sold at a higher price. A study shows that depending on your location, solar-powered homes may take an extra 8 days to sell compared to their counterparts.

Besides, lack of knowledge can also be a huge problem for the sellers to convince the buyers. If the buyers don’t understand some of the technical terms. They won’t be convinced to invest some extra money in a solar-powered home.

Whether it’s your home you’re planning to sell or you’re a professional seller, it’s important to consider your location, the tax incentives you’re getting, and the buyer before you install solar panels in the homes.


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