Solar Arrays and Home Value: What You Need to Know

Sabrina Lopez
November 15, 2021
2 min read

[Originally published on November 15, 2021, | Updated on January 24, 2024 - 5 min read]

Solar Arrays and Home Value: What You Need to Know

Baumann 1 - Silfab 370: The impact of solar arrays on home resale value is a topic of growing interest, especially as solar adoption increases. While fully-owned solar systems can enhance property value, the exact increase varies based on several factors.

The Impact of Owned Solar Systems on Home Value

A fully-owned solar system is a significant plus for most home buyers, akin to other high-value home additions. However, leased systems don't add to home value, as they aren't homeowner property.

How Much Value Does Solar Add?

An Arizona real estate expert, Tara Rutkowski, notes that solar installation can increase home value by $1,000 to $1,500 per kW, depending on system age and savings demonstrated. Nationally, Zillow found that homes with owned solar panels sold for about 4% more on average. This percentage can be higher in solar-friendly regions like Phoenix.

What Influences the Value Addition from Solar?
  • Location: Real estate and electricity costs vary, affecting solar's value addition.
  • Monthly Savings: Solar production and subsequent utility bill reduction are critical.
  • Cost and Incentives: The initial investment and available incentives directly impact the financial benefit when selling a solar-equipped home.
  • Home Size and Consumption: Larger homes with higher energy consumption may see a more significant value increase from solar savings.
  • System Age: Newer systems with more efficient technology offer better value.
  • Net Metering: Homes with systems under favorable net metering agreements may see higher value increases.
Solar System Size and Performance

The value added by solar is more about system performance relative to power consumption than size. A smaller, efficient system on a low-consumption home can be as valuable as a larger system on a high-consumption home.

The Bottom Line on Solar as an Investment

Solar is a unique home improvement that starts paying back immediately. It's an appealing feature for environmentally conscious buyers and those looking to reduce energy costs. However, the decision to go solar should consider factors like how long you plan to stay in the home and the size of your current energy bills.

For a comprehensive guide on buying and selling homes with solar, you can download our free guide, "Buying & Selling A Solar Home." Please feel free to contact Sun Valley Solar Solutions for a free quote if you're considering solar.