I have been looking into adding solar panels to my house. I would like to for the environmental benefits, but I know that my wife is concerned about what this will do to the property value of our house. Do you know if there is anywhere that shows concrete evidence as to how solar panels affect the resale value of your home? I am sure that if there is solid evidence that solar panels increase a home's value that this would be a great selling point, not only to my wife, but for anyone. Kyle G - Vancouver, WA
Kyle, the answer to your query, frankly, includes regions of the country, quality of installation, and knowledge of realtors and appraisers -- among other issues. Generally in areas where there are concentrations of solar water heating and photovoltaic installations, such as in Arizona, California, New Jersey and Florida, housing prices with solar installations have been rising as quickly as homes without these systems - and in some cases bringing even higher prices for home resale. This especially is true in areas of the countries experiencing a high number of electric outages or utility rate increases.
In, Andrew J. Black's American Solar Energy Society paper presented at the Solar 2004 conference in July 2004, he reports, "These monetary benefits are financially quantifiable. A solar electric system increases home value by $20,000 for each $1,000 in annual reduced operating costs, according to The Appraisal Institute. A solar electric system compares very favorably with other home improvements in percentage of cost recovered. Often, a solar system can recover much more than 100% of its cost, and this percentage actually increases overtime as electric rates rise." The Appraisal Institute located in Chicago (www.appraisalinstitute.org) publishes reports for home appraisers since they must be able to support the conclusions and explain their evaluation process clearly -- and it is these professionals that impact resale costs for housing.
But as Joel Gordes of Environmental Energy Solutions, CT states, " ... bad looking PV installations could be a disincentive for others to buy homes..." High quality installations taking into account aesthetic aspects in every detail from piping and wiring runs, color homogenization of exposed system components -- play a huge part in resale value. In areas where appraisers and realtors have little experience with solar and the home market is poorly saturated, solar installations have dampened resale values a slight bit. But overall, with extremely high natural gas prices and ever increasing electric utility rates coupled with increased experiences of poor electric power reliability and quality - solar installations on homes, if done professionally, significantly increase the home's value -- and that is why many states actually exempt that increase in value from local tax assessments -- as a way to encourage solar even though it will increase the home's base tax assessment.