Solar panels are not only good for generating electricity. They also raise real estate values.
That’s according to a new study that found that each kilowatt of solar capacity could net a premium of almost $6,000 in home value. So, a 5KW array–typical now on many homes–could command almost $30,000 in extra sales income.
Logically, the results makes sense. Investing in a home’s energy generating capacity–assuming it produces cheaper power than on the grid–should make a home more valuable. However, the Lawrence Berkeley’s researchers did find one fly in the ointment. “Solar premiums” fell sharply as arrays got older: 9% per year across the homes studied. That’s more psychological than anything. Solar panels do deteriorate in performance over time, but not that fast–on average only at 0.5% per year, according to the researchers.
“[The panels] might be perceived as older technology, even if they’re still producing electricity at the expected rate,” lead author Ben Hoen told the San Francisco Chronicle, explaining the disparity.
The study comes from the Lawrence Berkeley National Laboratory, which compared the value of 1,894 Californian homes with solar against 70,425 homes with no solar. All the homes were sold between 2000 and 2009, and had systems bought outright (i.e not leased, as is now more common).
Real estate appraisers tend not to account for solar panels when judging home values. At the moment, most neighborhoods don’t have enough arrays to make reasonable comparable home estimates. But Hoen expects that to change–slowly. His numbers are in line with one appraisal system that hit the market last year. Called PV Value, that tool makes estimates based on system size and positioning, and a state’s energy prices, among other factors. Hoen plans more research in other states, and for homes with solar leases. Solar appraising should become the norm soon enough.