Reviewed by: Brandon Brown

As the world gravitates towards sustainable living and energy efficiency, homeowners are often left pondering the impact of solar panels on their property’s resale value. With rising energy costs and a global emphasis on reducing carbon footprints, the addition of solar panels has become more than just an environmentally friendly decision—it’s evolved into a strategic financial move. But why is this topic gaining traction, and how can homeowners make the most of it when preparing to sell?

These are all valid questions, and here at FlipSplit, we’re committed to equipping you with the knowledge you need to approach the home-selling process with confidence. In this guide, we’ll shed light on how solar panels influence your home’s resale value, ensuring you have all the information you need for a smooth, profitable sale.

Why Solar Panels Matter in the Resale Game

The answer to “do solar panels increase home value?” is fairly straightforward: yes! But how much value does solar add to your home? A study from the Appraisal Journal suggests that for every dollar saved on energy costs due to solar energy, about $20 is added to your home’s value.¹ That’s not just a minor uptick—it’s a substantial boost to your investment!

Moreover, the benefits don’t stop at mere valuation. Homeowners who invest in solar systems often find that the slash in energy bills—up to $1,500 per year, according to Forbes Home—combined with the increased property value quickly offsets the initial cost of the solar setup.² Think of it this way: when a potential buyer is house-hunting, a home equipped with solar panels offers them not just a house but a promise. A promise of lower utility bills, a more sustainable living environment, and an alignment with modern, eco-friendly values.

For instance, in areas like San Francisco, where renewable energy is highly regarded, homes with solar panels are often more coveted.³ This means your property could fetch an even higher price just because you’ve tapped into the sun’s power!

Tips for Marketing Homes with Solar Panels

So, how can you ensure you’re highlighting this value-add when it’s time to sell? Here are a few tips:

1. Showcase the Savings: Prepare a breakdown of your monthly energy savings since installing the panels. Buyers will appreciate the tangible evidence of cost reduction.

2. Share Performance Data: If possible, provide data on the performance of your solar panels, such as their efficiency rate or total energy generated. This offers potential buyers a clear understanding of the system’s capabilities.

3. Highlight the Green Aspect: In a world striving for sustainability, emphasize the eco-friendly benefits. Remind buyers of the reduced carbon footprint they’ll be contributing to.

4. Stay Updated with Maintenance: Ensure your solar system is in top-notch condition. A well-maintained system is more appealing and assures a potential buyer of its longevity.

5. Use Visuals Effectively: Incorporate high-quality photos and videos of the solar installation in your listing. Consider using drone shots to showcase the extent of the solar panels, especially if it covers a significant portion of the roof.

6. Highlight Financial Incentives: Make buyers aware of any existing tax credits, rebates, or financial incentives that come with the solar system. These can make the prospect of owning a solar-powered home even more enticing.

7. Educate with Workshops or Demonstrations: Consider hosting an open house where, in addition to showcasing the home, you offer a brief workshop or demonstration on how the solar system works. This can demystify the technology for potential buyers and make them more comfortable with the idea of owning and maintaining a solar-powered home.

As you prepare your home for the market, remember that your solar panels are a testament to a greener future and a smarter investment. Embrace them, showcase their advantages, and watch as they elevate your home’s appeal and value.

Understanding the Appraisal Process for Solar-Powered Homes

When it comes to selling a solar-powered home, the appraisal process holds particular significance. As homeowners, it’s easy to recognize the inherent value of solar panels—from energy cost savings to eco-friendly living. But for appraisers who are tasked with determining the market value of a home, they may wonder, “Do solar panels add value to your house?” and must be made aware of these unique benefits to ensure an accurate and fair valuation. This step is essential, not only to secure potential profit from your investment but also to set a precedent in the real estate market that acknowledges the tangible benefits of sustainable living.

Making the Most of Your Solar Home Appraisal

1. Documented Savings: Gather and present monthly or yearly records that showcase the energy savings you’ve achieved since installing your solar panels. This concrete data will provide a clear picture of the cost benefits.

2. Highlight Tax Credits and Incentives: Solar installations often come with tax credits and other financial incentives. Make sure the appraiser is informed about these, as they can positively influence the home’s overall valuation.

3. Provide Warranty and Maintenance Details: A solar panel’s warranty can be a selling point, as it assures potential buyers of its durability. Moreover, showing regular maintenance records can further emphasize the system’s reliability.

4. Offer Comparative Analysis: If possible, provide examples of comparable homes in your area with similar solar installations and their respective market values. This can serve as a benchmark and guide the appraisal process.

5. Emphasize the Eco-Friendly Aspect: While monetary benefits are tangible and essential, don’t forget to stress the environmental advantages. A home that promotes sustainable living can be particularly appealing to a growing eco-conscious market.

Remember, the key to a successful appraisal for your solar-powered home lies in proactive communication. Ensuring the appraiser understands the full spectrum of benefits your solar installation offers will help guarantee your home’s value reflects its true worth in today’s green-centric market.

Addressing Buyer Concerns about Solar Panels

Navigating the real estate market brings about a multitude of questions, from “Does a pool add value to your home” to “How to sell a fixer upper.” And when preparing to sell a house with solar panels, asking “Do solar panels add value to a house?” is completely understandable. By highlighting energy savings, available solar incentives, tax credits, and net metering, you can assure potential buyers of the value and efficiency of your solar energy system. To address any concerns they might have, equip yourself with clear, concise, and factual information, including:

1. Efficiency and Cost Savings: Start by explaining the efficiency of your solar system. Highlight its capability to significantly reduce energy costs, making a notable difference in monthly utility bills. This cost-efficiency is a strong selling point, as it promises potential buyers long-term savings, making your home an economically smart purchase.

2. Relationship to Other Home Improvements: It’s also helpful to relate the solar panel system upgrade to other value-adding home improvements. Just like new appliances and a fresh coat of paint can enhance its appeal, your solar installation contributes positively to your home’s overall value. Show buyers the tangible benefits, comparing the solar panel’s utility cost reduction to the cost savings and efficiency of other household improvements.

3. Environmental Impact: Additionally, make a note to discuss the environmental impact. In a world increasingly concerned with sustainability and eco-friendly living, a solar power system stands out as a significant advantage. It minimizes the home’s carbon footprint and promotes green living, aspects that are attractive to many contemporary buyers.

4. Incentives and Tax Benefits: Don’t forget to mention the various incentives and tax benefits linked to solar panel installation. Federal and state solar incentives can mean further savings for homeowners, making it another compelling argument for the value addition of solar panels.

5. Addressing Leased Solar Panels: If your solar panels are leased, be upfront about it. Explain the terms clearly, and reassure potential buyers about the process and benefits of taking over the solar lease.

6. Prepared Documentation: Have all relevant documents prepared, including details about the solar installation, maintenance records, energy bill comparisons, and information about any applicable incentives or tax credits. Providing these documents promptly will demonstrate transparency and help establish trust with potential buyers.

By addressing these concerns and questions comprehensively and proactively, you’ll be aiding potential buyers in recognizing the substantial value that solar panels add to your property, ensuring a smoother selling process and a mutually beneficial transaction.

Potential Pitfalls: Can Adding Solar Ever Decrease Home Value?

While solar panels usually signify savings and increased home value, it’s also critical to be aware of possible scenarios where they might not add the expected value to your property. Issues such as outdated or dysfunctional solar systems, reduced efficiency, or a negative impact on your property’s curb appeal due to poor aesthetics can lead to a decreased home value.

These situations, however, are avoidable. Ensuring proper installation, regular maintenance, and keeping a close eye on market conditions and advancements in solar technology can all contribute to a consistent increase in your home’s value. Enhanced energy efficiency and long-term savings are the typical outcomes of adding solar panels, overshadowing potential pitfalls when managed attentively.

Mastering Home Inspections with Solar Installations

The presence of solar panels adds another layer to the home inspection process. For prospective buyers, these installations represent not only a sustainable choice but also a financial investment. As such, it’s paramount for sellers to ensure their solar systems are showcased in the best light—both literally and figuratively.

During the inspection, emphasis should be placed on the operational efficiency of the panels. Ensuring they are clean, free from obstructions, and in prime working condition is paramount. Provide the inspector with detailed maintenance records, warranties, and any servicing documentation, as this showcases the care and diligence invested in the system over the years.

Furthermore, offering a historical record of electricity bills can visibly demonstrate the tangible cost savings realized from the installation. If there have been any system upgrades or enhancements, such as better inverters or advanced storage solutions, make these known, emphasizing their added value. Lastly, open communication is key: being well-informed and ready to address any queries the inspector might have about the solar setup will not only smoothen the inspection process but also reinforce the value and appeal of the solar-equipped home in the eyes of potential buyers.

Engaging with iBuyers: Solar Panels’ Impact on Offers

In today’s tech-driven real estate environment, engaging with iBuyers—digital platforms offering quick home purchases—has become an increasingly popular practice. If your home boasts solar panels, you’re poised to have a distinct advantage in this space.

To resonate with iBuyers, accentuate the tangible benefits of solar installations. Emphasize the energy cost savings, the home’s boosted energy efficiency, and the eco-friendliness it brings. Highlight potential tax credits and the reduced maintenance costs compared to homes powered by conventional energy sources.

By underscoring these points, your property becomes a compelling choice for iBuyers, emphasizing both its environmental and financial perks. When presenting your home, equip yourself with documented energy savings and maintenance records to bolster your negotiation. This strategic approach can play a pivotal role in potentially increasing offers from iBuyers, promoting a profitable return on your solar panel investment.

Ensure Maximum Value from Your Solar Investment with FlipSplit

Solar panels are not just about reducing your electricity bill. As we’ve discussed, they’re a strategic investment to increase your home’s value. According to the National Renewable Energy Laboratory, homes with solar panels sell 20% faster and for 17% more than those without.⁴ With these compelling statistics in mind, it becomes clear why having the right partner to guide you through the selling process is essential.

At FlipSplit, we’re committed to providing you with the necessary information and unwavering support needed to navigate selling your home with confidence—even if that means taking care of the entire process for you! Our method is refreshingly simple: we deal in buying and selling homes. It begins with us proposing a cash offer for your home’s market value, without any hidden fees or commissions, and our transparent bonus participation agreement guarantees your equal share in any profits above the set benchmark.

So, whether you’re enhancing your home’s energy efficiency by installing solar panels or seeking an effortless home sale, discover how FlipSplit can transform your selling experience by requesting an offer today!

Sources:

1. Planning for PV the Value and Cost of Solar Electricity. www.nrel.gov/docs/fy08osti/42733.pdf
2. Crail, Chauncey. “How Much Do Solar Panels Save the Average Homeowner?” Forbes Home, 25 Oct. 2022, www.forbes.com/home-improvement/solar/how-much-solar-panels-save/
3. Solar, Citadel Roofing &. “How Solar Increases California Property Values.” Blog.citadelrs.com, blog.citadelrs.com/how-solar-increases-california-property-values. Accessed 27 Sept. 2023.
4. Farhar, B., and T. Coburn. A New Market Paradigm the Comparative San Diego Case Study Volume 1 of 2 Link to Volume 2: Appendixes. 2006, www.nrel.gov/docs/fy07osti/38304-01.pdf
5. “Homeowner’s Guide to Going Solar.” Energy.gov, www.energy.gov/eere/solar/homeowners-guide-going-solar

Reviewed by: Brandon Brown

As a long-time Asset Manager, Investor, Real Estate Agent, and Broker/Owner of BayBrook Realty in Orange County, Brandon Brown is one of FlipSplit’s lead Real Estate experts. Having worked on over 2,000+ real estate transactions, Brandon brings a depth of knowledge that ensures clients are appropriately treated with honesty and integrity. His insights and advice have been published in numerous blogs beyond FlipSplit, and he keeps a close eye on market trends and statistics, which are updated weekly on his social media pages. Outside work, you can find him participating and serving at church, cycling, mountain biking, surfing around Orange County and beyond, and enjoying time with his wife and two daughters.