Enhance Your Home’s Value with Solar Panels

Solar Panel

There are a variety of benefits to be derived from installing solar panels at your residence. These include lowering energy costs and lessening the environmental impact your residence has on the surrounding world.  

If you elect to install solar panels at your home, you are likely to enjoy another significant benefit. Solar panels will nearly always increase the market value of your residence.

 

Research by United States Department of Energy 

The United States Department of Energy has overseen a recent research study that examines how sustainable features increase the value of a home. These sustainable features include rooftop solar panels. The end result of this study is that appraisers need to include solar panels into an overall calculation of home value. 

The research study was conducted by Lawrence Berkeley National Laboratory in California. The study examined sales data from approximately 23,000 homes in eight states. The study covered a time period from 2002 to 2013. Of the residences included in the study, about 4,000 of the homes had solar photovoltaic systems. Of these systems, all of them owned as opposed to being leased through some sort of solar energy enterprise.

 

Specific Research Study Findings  

The researchers learned that home buyers were willing to pay a premium for a residence that came complete with a solar energy system. The average premium as about $15,000 for a residence that has an average-size solar photovoltaic system. An average system is defined as 3.6 kilowatts, or 3,600 watts. This breaks down to a price increase on the value of a home of about $4 for every watt of energy generated through a solar system.

This particular study involved more sales of homes with solar systems than did previous research. This study is considered to be particularly “robust” in regard to the number of homes involved in it.

 

Increase in the Number of Home Solar Systems 

Over the course of the past 10 years, the number of residences in which solar panels have been installed has been on the increase. This is significantly a result of the fact that the costs associated with residential solar systems has been dropping. Currently, over 500,000 U.S. residences have solar systems in place.

 

Real Estate Professionals and Home Solar Systems

Despite the results of this research study, and related data, real estate professionals have been somewhat behind the curb in appreciating how solar systems increase the inherent value of a residence. This includes agents, brokers, appraisers, and lenders.

 

Fannie Mae and Residential Solar Energy Systems

Fannie Mae, a major player in the home mortgage market, has been relatively proactive when it comes to the impact solar energy systems have on residential property. Fannie Mae issued guidelines specifying how an appraiser needs to analyze a solar system in light of the prevailing real estate market.

The Fannie Mae guidelines are described as having “critical verbiage: designed to provide specific guidance regarding addressing the impact solar panels have on the overall value of residential real estate.

 

Leased Residential Solar Energy Systems 

As referenced previously, this particular study addressed only residential solar energy systems that are owned by the homeowner. The study excluded leased systems from the mix.

The recommendation from this initial research is that further research on the impact of leased systems needs to be conducted. The thought is that even a leased system that is not owned outright by a homeowner does contribute in some manner to the market value of a home.

There are a number of factors to bear in mind when it comes to a leased system. First, some of these systems are designed with the ultimate objective of transferring ownership to the homeowner at the end of a specific lease term. Second, in other scenarios, the lease continues indefinitely with the exiting homeowner. The issue in both situations (when the lease is active) is does the property interest transfer to a new homeowner. There are differences in this regard among different agreements.

 

Residential Solar System Trends

Most industry analysts predict that an ever increasing number of residences in the United States will feature rooftop solar panels and associated solar energy systems. One of the primary reasons this trend is expected to continue into the future is because the coasts associated with these systems is expected to continue to drop.

A second reason why these systems are expected to become even more prevalent arises from the fact that more and more homeowners are becoming interested in “green homes.” Installing a solar energy system represents one of the surest ways that a homeowner can have a more positive impact on the environment.

 

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Jessica Kane is a professional blogger who writes for Federal Steel Supply, Inc., a leading steel tubing suppliers of carbon, alloy and stainless steel pipe, tubes, fittings and flanges.

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