If you are selling your home you might be tempted to make some additions to your home to increase its value. We look at how solar panels increase home value.
Real Estate

Selling Your Home: Do Solar Panels Increase Home Value?

It’s predicted that by 2024, 2.5% of homes in the US will have solar panels. This may not sound a lot, but in effect, it means that one in every 40 houses will have solar panels by that date.

If you’re thinking about adding solar panels to your home, you may have questions. For instance, you may be thinking about moving home at some point in the future. If you do, you won’t be able to take your solar panels with you.

Does that mean that you’ll lose out on your investment? Or do solar panels increase home value so that you can recoup your investment through the sale price?

The short answer is: yes, solar panels do increase the value of your home. Read on to learn more.

How Do Solar Panels Increase Home Value?

The reason that most people invest in solar panels in the first place is so that they can generate some of their own electricity through the power of the sun.

Solar panels don’t come cheap, but by generating your own energy, you don’t need to use so much from the grid. These solar energy savings mean that over time you will earn back the cost of your initial purchase and installation and begin making a return on your investment.

When someone buys a home with solar panels already installed, it means that they can take advantage of the savings that solar panels provide, without having paid any of the upfront costs. Since solar panels offer money-saving potential, prospective buyers are willing to pay more for a house with solar panels than without. 

How Much Do Solar Panels Increase Home Value?

The exact amount that solar panels increase home value is affected by a number of factors, which we will look at in more detail below.

However, for a rough ballpark figure, a study by real estate marketplace company Zillow found that on average, houses with solar panels sold for 4.1% more than those without. With the median house price in the US being around $375,000 in 2020, that represents an increase in the sale price of more than $15,000. 

This is roughly equivalent to the initial cost of solar panels in the first place, meaning that you won’t lose out on your investment if you choose to move home.

What Factors Affect The Value Added by Solar Panels?

As with any average, not everyone will achieve the same added value. Some people may see their house increase by less than 4% whereas others may see it increase by more. There are several factors that can influence the total increase in the value of your home that solar panels can provide.


Location is a major factor in determining how much value solar panels will add to your home. 

The same Zillow survey found that in New York, solar panels would add 5.4% to the value of your home on average, whereas in Riverside, CA, that value would fall as low as 2.7%. Some of this comes down to the demand for solar energy in your region, as well as the potential energy savings that solar panels can offer in your location.

If your home doesn’t have a south-facing roof, that doesn’t mean that you can’t still invest in solar panels. Options such as solar pergolas allow almost anyone to benefit from solar energy, regardless of the orientation of your home.

Local Prices

Another major factor in determining the value that solar panels can add to your home is the price of installing them in your local area.

Installation prices vary from location to location. If installation costs are higher in your location, then you’re likely to see a larger bump in the value of your home than you would in a location where installation costs are relatively low.

That’s because buyers will be able to benefit from the increased solar panel ROI they would get from buying a home with solar panels already installed.


Taking location out of the equation, the ultimate factor determining how much solar panels will add to your home is the output of your system. 

Solar systems are designed to produce a set energy output, and not surprisingly, the more energy your panels can output, the more the value of your home is going to increase.

Some studies have estimated that the value of your home will increase by about $4 per watt of energy output. So a 4KW system would add about $16,000 to your house value, whereas a 6KW system would add $24,000. 


Nothing lasts forever, and this is equally true for solar panels. 

Modern solar systems can last for about 30 years, but the older they get, the less efficient they become, and the more likely they are to need repairs. An older system will understandably add less value to your home than a system that is at the beginning of its lifespan. 

Other Benefits of Selling a Home With Solar Panels

There are some other benefits when selling a home with solar panels, besides the purely financial ones.

Many buyers these days are looking for homes that are more energy-efficient and less harmful to the planet. It’s estimated that up to 80% of buyers are looking for homes with energy efficiency features, so your home is far more likely to be in demand when you’re selling.

This increased demand offers another benefit too. If you’re looking for a quick sale, homes with solar panels sell 20% more quickly than those without them. 

Are You Thinking About Investing in Solar Panels?

Now that you know that solar panels increase home value you may be considering investing. 

As stated above, the amount that solar panels will add to the value of your home is determined by a range of factors, but the biggest factor is the system output. This is something to bear in mind when choosing a solar system to invest in. A larger system will be more expensive but will add more value to your home as well as providing more energy savings.

For more useful content on real estate and beyond, be sure to check out the rest of the site. 


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