Does Solar Increase Home Value? What the Data Shows

One of the most common questions about solar is whether it increases home value. The short answer: yes, by about 4% on average. But the details matter.

What the Studies Show

Multiple studies have examined the impact of solar on home values:

Zillow Study (2019)

Homes with solar sold for 4.1% more than comparable homes without solar
On a $400,000 home, that's $16,400 in added value
Effect was strongest in areas with high electricity rates

Lawrence Berkeley National Lab (2015–2019)

Solar adds $15,000 on average to home value
Each kW of solar adds approximately $4,000 in value
Effect is strongest for systems under 10kW (typical residential size)

Appraisal Institute

Appraisers increasingly include solar in home valuations
Solar adds value especially in states with high electricity rates
The value increase is recognized by FHA and Fannie Mae mortgages

Factors That Affect Solar Home Value

1. System Ownership

Owned systems: Add full value to the home
Leased systems: May actually decrease value or complicate the sale (the buyer must assume the lease)
PPA systems: Similar to leases — can complicate sales

Recommendation: If you plan to sell within 10 years, buy your system rather than lease.

2. System Age

New systems (0–5 years): Full value added
Mid-age systems (5–15 years): 50–70% of value
Older systems (15+ years): Minimal value added (approaching end of life)

3. Local Electricity Rates

High rates (> $0.20/kWh): Solar adds maximum value
Moderate rates ($0.12–$0.20/kWh): Solar adds moderate value
Low rates (< $0.12/kWh): Solar adds less value

4. State and Market

Solar adds the most value in states with:

High electricity rates (CA, HI, NY, MA, CT)
Strong solar markets (AZ, NV, NJ, MD)
High environmental awareness (CA, OR, WA, VT)

5. System Size

Systems sized to offset 80–100% of usage add the most value
Oversized systems don't add proportionally more value
Undersized systems add less value (buyers still see high utility bills)

How to Maximize Home Value With Solar

1. Buy, Don't Lease

Owned systems add full value. Leased systems can actually deter buyers who don't want to assume a 20-year contract.

2. Keep Documentation

Installation contract and warranties
System specs (size, panel brand, inverter type)
Production data (monitoring app access)
Maintenance records

Transferable warranties make your home more attractive to buyers.

3. Size the System Right

A system that offsets 80–100% of your electricity usage is most valuable to buyers. They want to see a near-zero electric bill.

4. Choose Quality Equipment

Tier 1 panels (recognized, bankable brands)
25-year product + performance warranties
Microinverters or premium string inverters
These signal quality and longevity to buyers

5. Ensure Roof Is in Good Shape

A new solar system on an old roof is a liability. If your roof is 15+ years old, replace it before installing solar.

Selling a Home With Solar

If You Own the System

Solar is a selling point — highlight it in your listing
Provide production data and savings estimates
Transfer warranties to the buyer
Get a solar-specific appraisal if your realtor isn't familiar

If You Lease or Have a PPA

Check if the lease/PPA is transferable
Some buyers may be deterred — consider buying out the lease before selling
Be transparent about the monthly payment and remaining term

The Math: Is Solar Worth It for Home Value Alone?

Let's say you install a $21,000 solar system (net $14,700 after ITC):

Added home value: ~$16,400 (4.1% of $400,000)
Energy savings over 5 years: ~$12,000
Total benefit at sale (year 5): ~$28,400
Net gain: $28,400 - $14,700 = $13,700

Even if you sell after just 5 years, solar more than pays for itself through value increase + energy savings combined.

Get a Personalized Analysis

Run our free AI Home Energy Advisor to see how much solar could save you and add to your home value. Our analysis considers your local electricity rates, sun hours, and home characteristics.

Or explore our pricing page for professional reports that include property value analysis and resale considerations.