Can Solar Panels Increase the Value of my Property?

When it comes to purchasing a residential solar system, potential solar buyers want to make sure the numbers make sense. How much will solar cost? How much will it reduce my electricity bill? How many years will it take for the solar savings to be greater than the overall cost? How large is the solar tax credit? How long will my panels last? And the list of questions goes on. At Blue Raven Solar, we encourage our prospective customers to ask questions so that they know exactly what solar will do for their month-to-month and long-term savings.

One question that customers often overlook or even forget to ask is the long-term effect of solar on the value of their home and property, and the truth is it can have both a positive and negative effect. Before you go trusting online sources that claim that your home’s value will immediately increase by 13% if you buy a solar system, give this post a read to understand all of the causes and effects of solar on property value.

Wait, so can solar decrease the value of my property?

Technically speaking, no, solar will rarely ever decrease the value of a home. One of the few situations where solar could cause a decrease in property value would be if they were improperly installed, causing damage to a customer’s roof or electrical wiring. However, in most cases solar companies offer warranties that cover any extra costs from damage or faulty installs. Here at Blue Raven Solar we offer a 10-year workmanship warranty and a 25-year equipment warranty, so decreasing the value of your home is a highly unlikely scenario.

Although solar rarely decreases property value, in some cases it can make a home more difficult to sell. Most solar buyers don’t have enough disposable income to pay for solar out of pocket. They take on a 10, 15, or 25-year loan to be able to get a new solar system on their roof. Most of these homeowners won’t run into any problems and will save thousands over the lifetime of their system, but some solar owners run into problems when they decide to move and sell their home a couple years into their contract. The issue with selling while having a solar contract is that most homebuyers will avoid taking on any loan payments that are outside of their new mortgage. Depending how far along the homeowner is in their solar loan contract, there are several options available to rectify this.

Option 1: The best option would be to convince the prospective homebuyer to contractually take on the solar loan payments. If the buyer really loves the home, they may be willing to pay these bills to lock in ownership of the property.

Option 2: If there isn’t a buyer willing to take on the solar loan, the homeowner may have to lower their desired sale price for their home in order to compensate for solar loan payments.

Option 3: The last option would be to use the money received from the sale of the home to pay off the outstanding balance of the solar loan.


If you’re selling your home but still have a solar loan, you may want to avoid potential buyers who will only purchase if the solar panels are removed from your home. This is the worst-case scenario, in which the homeowner will have to pay for the removal of the panels as well as continue to pay them off through their solar loan payments.

So, what can we learn about solar causing a decrease on the value of a property? Homeowners should have a plan before they decide to go solar. By knowing how long they’re going to live in their home and how long they’re going to take to pay off their solar loan, homeowners can avoid the majority of situations that would cause them to lose value on their home by going solar.

Is there ever a situation in which solar panels won’t affect the value of my property?

Many homeowners are tempted to go solar with larger solar companies who only offer power purchase agreements (PPAs) and leasing deals. In these solar offers, homeowners get solar installed on their roof and avoid paying any upfront or long-term costs. Although these deals can draw a lot of initial attention, homeowners who sign PPA or leasing deals do not own their panels. This means that they do not receive any local or federal solar incentives, and they do not control the price of their electricity. Rather than purchasing electricity from the local utility provider, homeowners with leased solar will pay the solar company at a fixed price for the power that the panels on their roof are generating. Thus, these deals can be lucrative for big solar companies, but hardly make a difference for the homeowner. Without ownership, homeowners who finance their solar panels through PPA or leasing will not increase the overall value of their property. The home buyer will also have to assume the payments for the PPA/lease, or the seller will have to buy out the contract.

When can solar increase my property value?

Solar becomes valuable when it is paid off and owned by the homeowners. Whether a homeowner has finished their loan payments or bought the panels with cash, homeowners who are debt free can expect to increase the value of their home for several reasons. Firstly, they control their power and don’t succumb to unfair, monopolized utilities companies. Secondly, they have ownership of an asset that has a large fiscal value. Thirdly, they can store power through battery backups during power outages and during the night. So, the best way to increase your property value with solar is by having your panels paid off.

How much will the value of my property increase?

There are several factors that can contribute to the overall increase in value to a property because of a solar install:

The first and most important aspect is the size of a system. When it comes to solar, bigger really is better for a couple reasons. A bigger system not only signifies that a home doesn’t rely on utility providers, but in some cases, they can generate excess power that can be sold back to utilities companies for a fixed price. In other words, some states allow residential homeowners to make money from their solar panels.

The second factor that contributes to the value increase is the age of the panels. Solar panel tech is a rather new industry and sees lots of new developments and improvements on a year-to-year basis. Thus, the older the panels are the less electricity they are likely to produce and the less value they hold.

The third factor that determines a systems value is where they are installed. In states that have higher electricity costs, the overall value of residential solar significantly increases.

The fourth factor that adds a boost in value to a home’s panels is the Federal Investment Tax Credit (ITC). In previous years, the ITC allowed all homeowners to use 30% (26% in 2020) of the cost of their system as a tax credit for the current or following year. Thus, a homeowner who bought a $30,000 solar system would receive $9,000 in tax incentives the following year. These incentives are not removed from the overall value of the system, meaning that the now $21,000 system after taxes is still worth $30,000 on a homeowner’s property. Because every solar owners’ system is different, it is hard to give an approximate estimation of how much a solar system will increase the value of a home or property, but as a general rule of thumb it should at the least retain its original value and help a home sell quicker if the system is paid off.

Does it make sense to buy solar to increase the value of my home?

In most cases, solar probably shouldn’t be treated like a short-term investment, because in most cases the cost will be equal to the increase in home value.  However, there are dozens of other reasons that prove that solar is a great long-term investment in 2020. And aside from the generic list of federal tax credits, low prices because of high competition, local incentives, and more, Blue Raven Solar makes it so homeowners can start saving from day one of their solar journey!  With our BluePower Plus+ financing package, homeowners can get solar for no cost out of pocket and not pay a single penny until 18 months into their solar journey. If you’re curious to see how much solar can increase the value of your home or save you on a month-to-month basis, click the link below and fill out your basic information in order to get on the phone with one of our solar specialists. They’ll be able to answer any of your questions about going solar and design and create a custom solar quote for your house at no charge!

No Comments

Sorry, the comment form is closed at this time.