Solar energy is quickly becoming more popular in the United States, with the industry experiencing 33% average growth each year. More homeowners are looking to invest in solar for its many benefits, particularly how solar panels increase the value of your home. Sellers can significantly improve their asking price when putting their homes on the market if they have solar panels.
Below, we'll explain how solar panels increase your home's value and how you can determine what factors will affect that value. We'll also show you why solar is a worthwhile investment across the board.
How Do Solar Panels Increase Home Value?
If you own a home and make the switch to solar, you're increasing the value of your home by:
Meeting demands: The solar industry is experiencing rapid growth as more consumers express interest in clean energy. Solar energy allows homeowners to live more eco-friendly, a growing consideration for homebuyers. On top of this, homebuyers are also looking for ways to reduce energy costs. Solar offers the perfect opportunity to let homeowners control and manage their energy consumption.
Keeping up with trends: The growth of solar and increasing demand means it's become more trendy to own a home with solar panels. When installing solar panels in your home, you're attracting buyers interested in keeping up with trends, making your home stand out from the competition. In a market where eco-friendly alternatives are becoming more popular, installing solar panels can help you sell your home quickly and at a higher market value.
Saving time and money: Homes with solar tend to sell 20% sooner than those without. Reducing the time your home is on the market saves time and money since you won't have to worry about storage, transportation or multiple mortgage costs. Having solar panels installed will also reduce the likelihood of taking your home off the market or reducing your asking price since many buyers are looking for homes with solar pre-installed.
How Much Does Solar Increase Home Value?
The specific amount will vary, but installing solar panels can increase your home's value by 4.1% on average. If you're taking into account the median value of a home, solar panels increase property value by approximately $9,274. However, this number changes based on your location and other factors, including:
Geography: In some communities, high electrical costs are the norm. Solar panels will increase your home's value more in these locations since they help offset these high costs. Additionally, your location will affect your sun exposure, which can increase your home's value if you have solar panels and a significant amount of sunlight.
Installation prices: The cost of getting a new system varies based on your area. If it's more expensive to install solar in your area, homebuyers will benefit from buying a home with installed solar panels, increasing your market value.
Output: The larger your solar system, the more energy it can generate. A more extensive system allows you to rely less on your electrical grid, which helps you save on costs. Homes with a more extensive solar system are also worth more as a result since buyers are looking for enough energy generation to get off the electrical grid.
Savings: When you install solar panels before selling your home, you'll have a general idea of how much you're saving. The more that you save each month, the more valuable your home will be on the market for buyers who are looking to rely less on the electrical grid.
Age: Over time, the value of your solar system will start to depreciate. You'll need to account for this when determining your home's value since older systems won't sell for as much, especially since the new owner may have to perform repairs or replacements sooner than desired.
Replacement value: Some solar systems have parts that are expensive to repair or replace. As a result, your home's value is affected if the new owner expects to pay a significant amount to make repairs.
Why You Should Invest in Solar
As you can see above, it's clear that solar increases your home value in many ways. Installing solar panels can help you get more for your home once you decide to sell, but there are other benefits to investing in solar, which include:
Solar incentives: Federal and state governments are helping encourage homeowners and businesses to switch to clean energy by offering incentives. For example, the federal government provides the Solar Investment Tax Credit (ITC), a tax credit of 26% in 2020 and 22% in 2023. Many states also offer incentives to help drive the clean energy movement forward. For example, Texas provides the property tax exemption, among other solar incentives, to reduce the amount homeowners owe in taxes while increasing their home's value.
Reduced energy costs: If you're considering selling your home in the future, you can still benefit from installing solar now. You'll save on monthly energy costs, allowing you to put the savings toward other things that could increase your home's value, such as a new coat of paint or necessary repairs.
Lowers your carbon footprint: One of the main reasons people are interested in going solar is that it helps reduce your carbon footprint. Rather than relying on an energy source using nonrenewable resources, solar panels use a resource that we'll always have in ample supply. Plus, using solar can reduce your carbon footprint up to 20 times more than using energy sources powered by fossil fuels.
Sell excess energy: In some cases, your solar panels may generate more power than you use. Instead of sitting on this extra energy, your local utility company may buy the excess energy your panels produced, which can help you see a little bit of extra money a month and helps you make a return on your investment.
Invest in Solar With S&H Solar
If you want to increase your home's value by investing in solar, S&H Solar is here to help! We're dedicated to helping small towns and rural homeowners switch to solar, allowing them to manage and control their own power. We'll help ensure that you have power to rely on, even during an outage. Our services will help you save energy costs and reduce your carbon footprint.
Our knowledgeable experts can equip you with a solar system that suits your needs. We value integrity and transparency above all else and will help you find what you need and teach you all you can do with solar. Get a free quote today or contact us to learn more about how we can help!