There are a lot of reasons to invest in solar panels. Not only are they great for the environment, but they look great on a home.
As a homeowner and potential seller, you’re probably wondering, “Do solar panels increase home value?” After all, you should keep an eye on the bottom line, and it’d be great if we could earn your money back when you eventually move on to your next home.
Real estate in Pennsylvania is booming at the moment. Here’s how solar panels can improve a home’s value and help save money.
The Cost of Solar
First, something to consider regarding investing in solar panels is if you have can afford it. In 2019 alone, the out-of-pocket costs were around $15,000 in Pennsylvania.
Although it would save money on electricity moving forward, solar could take between 8 to 12 years to earn back on your investment.
With that said, there are a few types of solar panels we can invest in at different price points, depending on our needs and our home’s available space. Incentives and rebates are also available to help offset the initial cost of installation.
Additionally, previously installed solar panels are often viewed as a great addition to a home that can drastically improve its value.
Types of Solar Panels
When considering the correlation between solar panels and property value, we first need to discuss the three different types of solar panels available.
Monocrystalline panels are the high efficiency and high aesthetic type. Both monocrystalline and polycrystalline solar panels are made up of silicon wafers, but the former is cut from a single crystal of silicon.
Typically, this type of solar panel has a sleek, black appearance due to how light interacts with the pure crystal. Back covers for this type of solar panel are usually black, silver, or white, and the metal frames can be either black or silver.
In terms of efficiency, they provide the highest as well as the largest power capacity. Monocrystalline also the most expensive option between the three.
Polycrystalline, meanwhile, tends to take on a bluish hue and is slightly less efficient than the monocrystalline alternative and more affordable. However, both tend to come in the same sizes.
Thin-film panels are the final type of solar panel you’ll find on the market. These are the thinnest and most low-profile options and boast the lowest cost.
One big tradeoff for thin-film panels is that they don’t last quite as long as the alternatives and have the lowest efficiencies.
For a homeowner looking to improve their home’s value, we advise you to avoid thin-film panels in general.
Solar Panel and Property Value in PA
How much do solar panels improve home value in Pennsylvania, though?
Along with New Jersey and North Carolina, Pennsylvania offers one of the highest solar premiums in the country.
Pennsylvania ranked second in the nation in 2019 for increasing its home’s value with solar panels. That average price increase was roughly $8,589 per home.
At the top was New Jersey, with an increase of $32,281 for the median-valued home.
Adding solar power to a home can bring value to your property the same as investing thousands of dollars into other home renovations.
However, the added price to your real estate sale likely won’t cover the entire cost of installing your solar system. At best, you could receive half of your downpayment returned in the property sale.
Instead of viewing solar panels as an investment to improve your home value, you should recognize that increased value as one of its overall benefits. If installed early into your living there, you’ll see lower energy bills and tax benefits year to year.
When we eventually sell your home, its increased value will be the cherry on top.
Do Solar Panels Increase Home Value
Amenities are a great way to improve the value of a home, whether that be a fireplace, a remodeled kitchen, or a jacuzzi. Likewise, solar panels afford various benefits to a property.
Homeowners browsing for properties will be more inclined to purchase a house with a solar panel already installed since they won’t need to pay for it themselves. Additionally, monocrystalline panels lend a sleek aesthetic to a property’s overall appearance.
As the country becomes more environmentally aware, the desire for homes with access to solar energy also increases.
Incentives and Rebates in 2021
Despite the high costs of solar, there are numerous incentives and rebates that can help offset that price tag.
Federal solar investment tax credit (ITC) takes a 26% tax credit on the cost of your solar system. It basically functions as a discount.
Net metering is an incentive set by your local electric utility. Any excess power you generate moves back into the grid, reducing how much you pay every month. If it exceeds the current bill, you receive a credit on your next one.
The solar renewable energy credit (SREC) scheme earns credits for every megawatt-hour of energy your solar system produces. Homeowners can then sell these credits to your electricity supplier.
Financial incentives are also available depending on the city and county that should be looked into. A solar installation company can let clients know about them in advance.
All of these incentives are meant to encourage investment in solar as an easy and worthwhile endeavor. Incentives then pass onto the next owner of the property when we sell, making for a substantial package deal.
Investing in the Future
Do solar panels increase home value?
Pertaining to both short and long-term ownership, they absolutely do. However, it’s not the kind of investment we’d encourage you to make immediately before putting your house on the market.
While it could take years to earn back on your solar investment, the incentives and previously installed equipment create an appealing real estate purchase.
Interested in selling in the Philadelphia area? Call our office or use the online form to send us a note, and we’ll reach out when we can.