Solar Panels Increase Home Value

You are probably planning to go solar, and now you are curious about how much more your property could be worth with functional residential solar panels installed. Savvy property appraisers, homeowners, and potential buyers know that solar panels increase home value in the real estate markets.

A recent report by real estate company Zillow revealed that property owners should be ready to spend thousands of dollars on home renovations in the same way they should evaluate the ROI from investing in residential solar panels. Solar energy in homes not only helps lower your monthly utility bills; if your property is energy efficient, it can increase its value by up to 4.1 percent compared to properties with no functional solar systems.

The same report suggested a potential property value increase of $9,274 for a medium-valued property (with solar panels) in the United States.

Solar panels increase home value. 

Suppose you plan to purchase two identical properties, right next to one another in the same neighborhood. The only difference is that one property has rooftop solar power installed, which helps eliminate a $220 electricity bill. The other property doesn’t have a rooftop solar system.

In this case, the property with a functional solar system can potentially save you $2600 every year. Not only do you make significant savings on power bills, but you are also minimizing your carbon footprint and preventing the impact on a future utility rate increase by generating your own electricity. Logically, it would make sense that the property with solar panels has a higher value than the one that doesn’t. But the important question is; how much more value?

The exact answer depends on many factors, including;

The age of your PV system

Solar Panels Increase Home Value

Suppose you installed your solar panels in 1995. In that case, you cannot expect to have as much property value as a home with a PV system that was installed in January 2021. Today’s solar modules are more efficient than solar panel kits manufactured in the early 1990s. So, newer solar panels are associated with more property value.

Your properties location

Solar systems last in excess of 25 years to 35 years. Depending on where you stay, these systems can be income-generating and cost-saving assets. Utility bills vary significantly across different regions, and so do other solar policies such as solar incentives and solar property tax exemptions.

Solar performance-based incentives

Different states have performance-based solar incentive programs. That means they pay you a specific amount for the renewable energy you generate on an ongoing basis. Suppose you are fortunate enough to stay in one of such states like New Jersey and Massachusetts; your property with a solar system is likely to be worth a lot more.

In Arizona, property owners planning to install solar panels can enjoy federal tax credit, state tax credit, net billing, and other incentives. Keep in mind that solar panels increase home value, but the exact value will depend partially on the amount of solar tax credit and incentives you get. Consult with a reliable solar panel company to determine the exact amount of solar tax credit and the incentives you’re likely to get.

Cost of electricity

Some regions in the country have higher utility costs compared to others. Solar energy is worth a lot more in regions like Hawaii and New York because they do a better job of offsetting high utility bills. This doesn’t mean solar energy isn’t profitable in other states like Arizona, California, and others. In fact, solar panels increase home value in nearly every state.

Solar energy system ownership status

Suppose a property has solar panels installed, but the current owner does not actually own that energy system due to various arrangements like a solar lease. In that case, the property value may not be much higher. This is because the solar panels are not part of the home, and someone else owns them. Sure, your electricity bill savings will be available, but at any time, the solar leasing company can repossess their panels if they wish to.

Besides, a new home buyer wouldn’t qualify for local solar incentives such as renewable energy certificates. This is because those documents or incentives were forfeited to the solar leasing company upon the system installation. It is true that solar panels increase home value, but only if you own the property and the entire solar energy system.

Keep your solar energy system documents safe.

When it is time to sell your property, it is recommended to have all solar-related records available for the prospective property buyers to view. As mentioned earlier, solar panels increase home value, which means your home’s price tag will be slightly higher than that of a similar property with no solar energy system. In this case, you will need sufficient proof that a licensed and reputable installer handled the entire solar panel installation process.

It’s also important that you have all records of the systems warranty information. Potential home buyers may also want to see your power bills before and after installing the solar energy system as proof of potential energy savings. This is one way to prove to potential buyers that solar panels increase home value and give them a reason to pay a slightly higher price for your property.

These documents must be kept safely. You may want to work with an experienced real estate agent just to be sure you get timely communication about the specific solar records that may be required during the property sale.


If you are planning to install residential solar panels, do it. It is beyond doubt that solar panels increase home value and allow property owners to make significant savings on monthly utility bills. When it comes to selling your property, you can expect a higher price compared to a similar property with no solar panels installed.

The point is; a solar energy system is a sleek, smart investment. Most Americans shopping for residential properties are more likely to pick an energy-efficient home powered by green energy. That means solar panels increase home value and can help get your property sold faster.