Many solar companies would argue that the installation of solar panels will increase the value of your home. The problem with this statement is that it is all subjective to the buyer. Because the epidemic of solar panels has become a fairly new trend, we are facing the challenge of gathering enough data to prove whether homes with solar panels truly do add value to the sale of a home.
One of the major benefits of installing solar panels is the reduction in the home’s electricity bill. In addition, there is an increasing trend in environmental conscious consumers that find “green-friendly” home more appealing than one that is not. *The National Bureau of Economic Research released an analysis that found solar panels can add about 3.5 percent to a home’s value. Where the Appraisal Journal states that a home’s value increases roughly $20 for every $1 decrease in energy costs. So if the solar panels save you $600 a year, the home’s value may increase by $12,000.
The biggest factor that home owners take into consideration when deciding whether or not to instal solar panels is cost. Depending on your average usage of watts you can be paying anywhere from $4-$9 per watt. Some companies quote that a cost can average anywhere from $25,000-$100,000. However, today many companies are offering different programs to make installation of solar panels affordable with as little as $0 down. The trade off is a leased or payment plan can be as long as 20-25 year. NPR just posted an article about a home owner who had to negotiate a $10,000 credit to the buyer for unexpected lease fees. You can read the full article HERE.
So, the question still stands: Do solar panels increase or decrease the value of your home??? I would say that there is not black and white answer, but rather it depends from home to home. Things to take into consideration:
-What type of neighborhood is your home located in? A community filled with college graduate, millennial, hybrid driving consumers may be more inclined to purchase a solar powered home than an older community.
-The benefits of buying verses leasing or opting for a payment plan.
-How much money does it save you on a monthly or annual basis?
If you do have solar panels and plan on putting your home on the market for sale, make sure you are clear to the buyer what the benefits are of having the solar panels (monthly or annual savings) and/or the costs that they will incur.
Here is a good article from HGTV on how to calculate and budget whether or not installing solar panels is the right move for you.
As always, feel free to contact me with any questions or comments. Make it a great Weber Weekly Wednesday!!!