Solar Panels Can Increase the Value of Your Home
by: Gary Ashton
Licensed real estate agent in Ohio
For homeowners who foresee remaining in their homes for years and have energy consumption concerns, installing solar panels is a likely consideration. Adding these devices offers important benefits. They can lower utility bills, boost the resale value of a home, and reduce the amount of time it takes to sell it.
Most U.S. Homes Have Solar Potential
Why go solar beyond wanting to be energy-conscious? As prices for electricity continue to climb, the potential cost savings from solar panels becomes more and more apparent. It begins on the day of installation and continues for as long as you occupy the property.
Many homeowners leaning toward solar wonder whether their homes actually have the potential for solar power. In fact, the roofs of 79 percent of U.S. homes contain enough unshaded surface to accommodate solar panels.
Some parts of the country are obviously better suited to this technology than others are. Houston has the greatest solar potential of any U.S. city. More than 90 percent of the residences in Arizona, New Mexico, Nevada, and Hawaii can accommodate panels. The figure is still greater than 60 percent in northern states such as Maine, Pennsylvania, and Minnesota.
Why not take advantage of free energy from the sun?
How Solar Panels Help With Resale
A recent study conducted by the Lawrence Berkeley National Lab analyzed the dollar impact of solar panel installation on the sales prices of more than 20,000 homes in seven states. Its conclusion: Solar panels increase home value.
Prospective buyers with a bent toward green living and saving on utilities are willing to offer more for a property with them. The research concluded that a California home with solar panels should sell for $20,000 more than one without them. The figure for a property outside that state was $15,000.
One useful tool for calculating how much the value of a home will increase with solar panels is a guide from the National Renewable Energy Laboratory. It suggests that for every additional dollar in savings off an energy bill after a solar installation, a home’s value rises $20.
Several factors can cause this standard to vary. The most important include:
- Location of a home in an active solar market
- Number and quality of solar photovoltaic panels installed
- Total home value as it relates to size of the residence
Recent statistics suggest that a homeowner could expect to see an average jump in resale value of $5,911 for every 1 kW of solar added to the home. On the West Coast, this translates into an average added value of $18,324 for a home of medium size with a 3.1-kW system. Boosting the solar capacity to 5 kW yields an estimated added value of $29,555.
While impressive, these numbers apply only to current utility charges and housing prices. If the price of electricity continues its upward trend across the country, the advantages of relying on solar panels will increase in proportion.
These devices can prove a big help when a homeowner needs to experience a timely sale. On average, properties with solar panels sell 20 percent faster than homes without solar capability. This is important for cutting the paperwork and time linked to selling a home.
Why is a decision to install solar panels a wise one? Consider:
- Savings on utility charges begin from the day of installation.
- The installation pays for itself in full as it delivers savings over the panels’ lifetime of 25 to 30 years.
- Even when a home sells soon after adding solar panels, its higher price permits recovery of most of or all installation cost.
- Buyers value retrofit systems as much as built-in technology.
- An ample Federal tax incentive of 30 percent is available for installing solar panels.
With the right solar panels, a homeowner could realize a return on investment of more than 200 percent. That beats almost any other financial vehicle available today.
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