Does A Solar Energy System Affect Property Value?

Solar is an investment that pays for itself and then some through the reduction of energy costs over the lifespan of the array. Research shows a grid-tied solar energy system increases home and property value and is an attractive selling point due to the financial and environmental benefits solar provides the new homeowners. 

What If I Relocate Before I Earn Back My Solar Investment?

Homes equipped with a solar energy system have shown to sell for a premium. Prospective homeowners are willing to pay more for a home which has a reduced or eliminated electricity bills. (Read more about the benefits of solar.)

According to EnergySage (2021), solar panels on average increase a home’s value by 3-4% or about $24,000 on a 6kW array. Today, with higher energy rates and rapidly expanding electric vehicle market, the percentage solar adds to the value of a home continues to grow. Homeowners with a typical residential array, after incentives, can reasonably expect to recoup the cost of the investment if they choose to sell their home. 

What Size of Solar Array Sells for the Most Money?

The size of the solar array is directly proportional to the energy consumption and energy production needs of the homeowner(s). According to SolarNation, for every $1 recouped in energy savings from solar, the system adds $20 to the home’s value.

It is important to keep in mind the cost of electricity. As electricity prices rise (and they will), so will the advantages of solar and the property value of energy-efficient and energy-producing homes.

Will It Take Longer to Sell A Property?

Studies have shown a solar-equipped home not only sells at a higher price but, will also sell faster than a home without solar. For prospective homeowners, solar translates into a smaller electric bill and is a highly attractive feature. It makes a house stand out in a crowded market and draws buyers based on the financial and environmental benefits a solar array provides. 

Does the Age of the Array Effect the Selling Value?

With all technology the newer it is the more desirable and higher the resale value. Solar has one advantage over most other advanced technologies: warranties. Solar manufacturers offer long warranty terms on their equipment and these warranties are often transferable to new solar owners.

Solar arrays often sell for more money when they are efficient, require little or no maintenance, and when the existing warranties have not expired.

What About Property Tax, Home Appraisals?

Any homeowner who has done renovations knows when you add value to your home you may also increase the home’s property tax. Many states and cities have property tax exemptions to encourage the use of solar energy. In Illinois and Wisconsin, a solar array will not increase your home or property tax liability.* In Iowa, for the first 5 years, a solar array will not increase your property tax liability*. 

*Consult with a property tax official for details on your local tax property codes.