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Green Realty: How Solar Power Factors into a Home Sale or Purchase

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An increasing number of homeowners are turning to solar power to save on their energy costs and to make less of an impact on the environment. Many times, solar panels can generate enough energy to power as much as 50 percent of the average home’s energy leading to significant savings on electric. Solar power installation companies also often state that adding solar power to your home increases its resale value. In actuality, solar panels can complicate your home sale or purchase.

Do Solar Panels Increase Home Value?

Although solar companies will insist that solar power increases the value of your home, this is not a guarantee. There are many factors that go into how solar panels affect your home’s value including:

  • The part of the country you live in
  • Whether you leased or purchased the panels
  • The type of home
  • How much energy costs are reduced by the panels

The starting value of your home is also a factor as higher-priced homes tend to see more value when they have solar panels installed than lower-priced homes.

Lower Energy Costs and Damage to Environment

There is no doubt that solar has significant benefits that can be an advantage when you try to sell your home. A typical solar panel can produce a significant amount of energy which help you save money on energy. For a potential buyer, this will be attractive as there are very few people who would not want to lower energy costs. Buyers who are conscious of their carbon footprint will also see benefits to a home with solar panels as solar energy has less impact on the environment than other forms of energy.

Leasing vs. Buying

Solar installations can be very expensive, ranging from $15,000 to $20,000. Very few homeowners have that much expendable income to add solar power to their home. Solar companies now offer leasing options. You sign an agreement that you will pay a flat monthly fee for the panels for the next 15 to 30 years. Leasing is attractive to many homeowners who want to switch to solar, but it can be a deterrent to buyers who aren’t interested in an additional monthly payment. In addition, some companies will not permit transfer of the lease to a new buyer, requiring the original homeowner to pay the balance on the lease should they sell the home.

Housing Market

The housing market also has an impact on the value of your home when it comes to solar panels. It must be mentioned that appraisers are not permitted to add value to a home because solar panels are installed because they are not a permanently installed in the structure. If you live in an area of the country with strong environmentally-friendly populations, solar power on a home may be well-received. In other areas of the country, there is less of a focus on the environment and solar panels may actually be a deterrent. It is important to know that the cost of your solar panels cannot simply be added to the price of your home when you sell it.

Before installing solar panels on your home, talk to a real estate agent to find out how they will impact your potential ability to sell your home in your housing market. If you are considering the purchase of a home with panels, a real estate agent can explain the advantages and disadvantages of the system that the homeowner has installed.


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