We got this question recently from a client and we thought it was something you might like to know about. Read on for the question and answer exchange we had regarding putting solar panels on a residential home.
Question: "Do you have thoughts/opinions on the effects of solar on property value? Will adding solar panels increase the value of my home?"
Answer: We get this question a lot as so many folks are interested in being environmentally conscious in our area. It certainly seems like there should be some value added to a home where solar panels have been installed; however, we don't really see that materialize in the sale price. For those that feel strongly about living more sustainably, it can be a real frustration but there are many other folks that are more motivated by other parts of the home like updated kitchens/bathrooms, location, and layout.
There is also the fact that solar panels can be purchased outright, financed or leased which further muddies the waters as to how much value a buyer should attribute to them. Solar panels owned outright would command a greater value than leased panels that still have an outstanding balance due.
The overall effect is that we don't really see any kind of value increase for homes that have solar panels installed. It is unfortunate but it's true nonetheless. Many buyers think having solar panels would be neat, however they aren't
necessarily willing to pay more for a home that has solar. We actually just sold one of our own rental properties that had solar panels on there and it wasn't mentioned as a feature that drew those buyers to the home.
In our experience, solar panels aren't a feature that necessarily drives buyers to or repels buyers from sales. However, it's a neat thing to do for the environment and homeowners that have them on the home typically like the energy savings. As with many home updates, homeowners should install solar if they like the idea and if they are OK with that upgrade returning less than 100% of the investment when they go to sell. Homeowners shouldn't install solar in an effort just to increase the value of their home.
What do you think? We'd love to hear from you! Do you have thoughts on solar panels? What about the accompanying leasing and financing obligations?
