Do Solar Panels Increase Property Value?
As a homeowner, you’ve probably got a list a mile long of improvements you want to make to your house. If your electric bill is high — or if you just want to do something positive for the environment — you may have considered adding solar panels to that list.
There are lots of benefits to solar energy, and it’s a nice thought to produce your own power without relying on the grid. Like any home improvement project, though, it’s important to think long-term before making a large financial investment in your home.
So, let’s cut to the chase. Do solar panels increase home value?
The Office of Energy Efficiency and Renewable Energy says that a solar energy system will likely increase your home’s value, and that buyers across the country have been willing to pay a premium of approximately $15,000 for a home with an average-sized solar array.
But Michael Miller, an experienced agent, says that in his experience working with buyers in Sacramento County, California, the reality is a little murkier. “It’s a mixed bag,” he says. “Some people value solar, but it is on a case-by-case basis.”
The reason, says Miller, is because in many cases, homeowners don’t actually own the solar systems installed in their homes. “A seller may own the solar outright,” he explains, “but in other cases, they may be involved in a lease where a third party owns the equipment. In other scenarios, the seller may have purchased the equipment with a loan.” This would create a lien on the house.
Miller says that in the latter two scenarios, he has seen buyers shy away from homes with solar because “they didn’t want to enter into that kind of arrangement.”
At the end of the day, says Miller, “Not everyone sees solar as valuable, but some see it as hugely valuable.”
Let’s dive a little deeper into solar panel options, to see where that value may lie.
There are two types of solar panels on the market today.
The first is a silicon panel, which comes in two forms: Monocrystalline and polycrystalline. According to SolarReviews.com, both types perform similarly. Monocrystalline panels have been around the longest, but polycrystalline panels are most commonly used today. Silicon panels are the most efficient panel on the market, ranging from about 18% to 22% efficiency.
The other type of panel you can choose is a thin-film solar panel. These thin-film panels are commonly found on products like solar shingles or solar tiles. They’re less expensive to produce, but also less efficient (about 11% to 13% efficient), which will impact how much electricity your panels can generate.
When you install a solar system on your house, you’ll have two options.
You can connect your system to the local utility grid, selling the excess energy you generate back to the utility company.
Or, you can install an off-grid system, which stands alone and is usually accompanied by a series of batteries and a backup generator that store power for you to use on cloudy days or overnight when the sun isn’t shining.