By David R. Baker
San Francisco Chronicle
Shell out the money to install solar panels on your home, and you’ll probably recoup that investment when it comes time to sell the house.
You may even make a little profit.
A study to be released today by Lawrence Berkeley National Laboratory found that solar boosts the resale value of homes, both new and old.
The researchers analyzed the sales of about 2,000 solar homes in California from 2000 through mid-2009 and compared the prices to those of 70,000 comparable houses without solar. On average, a solar system added about $5.50 per watt to a home’s resale value. For a home with a typical 3.1-kilowatt solar system, that represents an extra $17,000 above the cost of a comparable, nonsolar home.
During the same period, the study found that a typical residential solar system cost about $5 per watt.
“On average, folks have effectively got out of the home sale the same value or the comparable value that they put in,” said Ryan Wiser, one of the report’s authors. That’s in addition to saving on their electricity bills.
Many homeowners did better than break even. People who installed panels on pre-existing homes increased the resale price by more than $6 per watt, on average. In contrast, solar systems only added $2.30 to $2.60 per watt to the sale price of new homes built with solar included.
The study’s authors did not try to find the reason for that difference. But Wiser, a staff scientist at the lab, said it could be a matter of motivation. Homeowners who pay to install solar on an pre-existing house are keenly aware of the cost and don’t want to lose their investment.
“The homeowner puts that $5 per watt investment on their home, and if they sell the home the next year, darn it, they want to get that $5 per watt back,” Wiser said.
Developers who sell new solar homes, however, think of the system as just one of the home’s attributes. “Their goal is not necessarily to recoup the investment on any individual item,” Wiser said. “They want to sell that home and move on to the next.”
The study will be welcome news to solar installation companies.
Gary Gerber, president and chief executive officer of Sun Light & Power in Berkeley, said customers interested in the financial pros and cons of a solar system often ask about the effect on a home’s resale value. More important, home appraisers are often uncertain how to value what to do with residential solar systems, he said.
“I think appraisers are really casting about for guidance on this issue,” said Gerber, who is also president of the California Solar Energy Industries Association, a trade group. “They certainly set the price that the bank will loan. And if they and the bank aren’t in agreement on the value, it really doesn’t matter what the buyer and the seller want.”