Do Solar Panels Increase Home Value? [Data]
What peer-reviewed research actually found — owned vs leased, what appraisers count, and why your market decides the real number.
The short answer
Owned solar panels have been shown in research to raise resale prices; leased systems generally do not add appraised value and can complicate a sale. The single most important sentence in this article is this one: ownership changes everything. An owned array is treated by appraisers and buyers as part of the home. A leased or third-party-owned system is someone else's equipment sitting on your roof — the buyer inherits a monthly obligation, and appraisal guidance says it must not be counted in the property's value.
What the research actually found
The most-cited study on this question is "Selling into the Sun", published in January 2015 by Lawrence Berkeley National Laboratory with Sandia National Laboratories. It analyzed about 22,000 home sales across 8 states (1999–2013), nearly 4,000 of them solar homes, and found that host-owned PV systems sold at an average premium of roughly $4 per watt — about $15,000 for a typical 3.6 kW system at the time. Buyers paid the premium through housing boom, bust, and recovery alike.
A National Bureau of Economic Research (NBER) study of homes in Sacramento and San Diego, California, landed in a similar neighborhood, finding solar added roughly 3–4% to the market value of homes.
Now the honest caveats, because these numbers get quoted without them:
They are historical, not current. The Berkeley Lab data covers 1999–2013, when residential system prices were far higher than today. A per-watt premium from that era should not be read as today's price per watt of "value." The directional finding — buyers pay more for owned solar — is what has held up; the exact dollar figure is a study artifact of its era.
The premium fades as systems age. The researchers explicitly found that older PV systems commanded smaller premiums at resale. A 12-year-old array with a 5-year-old inverter is not worth what a 2-year-old system is — depreciation is real, and any appraiser worth the fee applies it.
They cover owned systems. Both studies examined systems the homeowner owned outright (including new-build systems bundled into the price). Leased systems were not shown to add value, and as we will see, current lending guidance actively excludes them.
Owned vs leased: the distinction that decides everything
| Owned system | Leased / PPA system | |
|---|---|---|
| Appraised value | Can be counted as a home improvement | Excluded — treated as personal property |
| Buyer's financing | No extra obligation | Buyer may have to qualify for the lease payment in their debt-to-income ratio |
| Sale process | Transfers with the home | Lease/PPA must be transferred to the buyer or bought out |
| Incentives | Owner claims them | Leasing company claims them |
| Reported resale premium | Yes, in published studies | No premium reported in the major studies |
Under Fannie Mae's selling guide, the rules are blunt: panels that are leased or owned by a third party may not be included in the appraised value of the property, and the monthly lease payment may need to be included in the buyer's debt-to-income calculation. That turns a leased array from an asset into a qualification hurdle: your buyer pool shrinks to buyers who can pass the solar company's credit check on top of their mortgage, closing takes longer, and some buyers simply walk away. Solar-industry experience reports consistently describe leased systems as a negotiation drag — sellers are advised to disclose the lease early, get a transfer specialist assigned by the solar company, and consider whether a buyout pencils out.
One more ownership-adjacent wrinkle: the 30% federal residential solar credit (25D) is not available for installs after December 31, 2025. So owned-system resale economics in 2026 rest on bill savings and buyer appeal alone — which is exactly what you should model (see the calculators below).
How appraisers actually value solar
For owned systems, appraisers who follow current guidance have three tools: comparable sales (recent sales of similar solar homes nearby), the income approach (capitalizing the annual energy savings into present value), and the cost approach (installed cost minus depreciation). In practice, the comparable-sales method is only as good as local data — in markets where solar homes are rare, there are no good comps and the number gets soft. The Berkeley Lab researchers themselves flagged that consistent valuation methods were still catching up, and appraisal practice has been uneven ever since.
This is a practical problem you can partly solve. An appraiser who cannot see the value will not assign it. Give yours a packet: the system datasheet, the original installation paperwork and warranty, a printout of 12 months of utility bills showing the savings, and the interconnection/net-metering agreement. The Appraisal Institute's residential green-energy addendum exists for exactly this purpose — ask your appraiser if they use it.
Why the answer varies by market
Two identical 7 kW systems do not add the same value in different places. The premium moves with:
Electricity rates. Solar is worth more where grid power is expensive. A system that saves a buyer $200/month in California offsets far more housing cost than one saving $60/month in a cheap-power state — and appraisers using the income approach land on very different numbers.
Net metering quality. In markets with full retail-rate net metering, the system's savings are worth face value. Where utilities have moved to net billing at wholesale export rates, the same system produces smaller bill savings — and a smaller premium. (See our how much you can save with solar panels breakdown for the savings side.)
Buyer awareness. The studies found larger premiums in markets where buyers already understood solar — green-conscious neighborhoods, high-solar-penetration areas. Where buyers have never met a rooftop array, they price it at zero and sometimes with suspicion.
System age and condition. As the Berkeley Lab data showed, the premium decays with age. A system under 10 years old with a recently replaced inverter is a selling feature; a 20-year-old system with original equipment is, at best, neutral and, at worst, a roof-maintenance question.
Selling a solar home: the practical playbook
If you are selling with solar rather than buying, sequence matters:
1. Know your ownership type before you list. Owned, financed (loan paid off vs. outstanding), leased, or PPA — check your original contract, not your memory. An outstanding solar loan that is secured by the panels can complicate title just like a lease does.
2. If leased, price the buyout. Ask the solar company for a formal buyout quote and compare it against the expected appraised premium and the cost of a drawn-out, transfer-delayed sale. A buyout converts the system to owned — appraisable, transferable, clean. If the buyout is steep on a small or aging system, plan instead for a cleanly documented transfer with the company's transfer specialist looped in from day one.
3. Document the savings. A year of utility bills, the system size in kW, the panel and inverter models, warranty paperwork, and the net-metering agreement. Hand this to your listing agent and the appraiser.
4. Check the roof calendar. If the roof needs replacing within a few years, buyers will price in the cost of removing and reinstalling the array. Re-roofing under panels costs materially more than a bare re-roof — get ahead of the question with an actual quote.
Check your own numbers
The resale premium is a bonus, not the business case — the real return on solar is the monthly bill savings. Model your system cost, savings, and payback in the solar ROI calculator, then read the full savings breakdown in how much you can save with solar panels. A system that pays for itself in bill savings in under a decade is a good investment whether or not the resale premium materializes.
Solar home value FAQ
Straight answers, no fluff.
Do solar panels increase home value?
In most studied US markets, yes — but only for owned systems. The most-cited research, Berkeley Lab's 2015 "Selling into the Sun" study of about 22,000 home sales across 8 states, found host-owned systems sold at an average premium of roughly $4 per watt, about $15,000 for a typical 3.6 kW system at the time. That is a reported average from 1999-2013 data, not a promise for any single sale — system age, local electricity rates, and buyer awareness all move the real number.
Do leased solar panels add value to a home?
Typically not in the appraisal. Under Fannie Mae guidance, leased panels and third-party-owned systems are treated as personal property and must be excluded from the appraised value — only owned systems can be counted as a home improvement. Worse, the buyer may have to qualify for the lease payment on top of the mortgage, which can shrink your buyer pool or delay closing unless the buyer agrees to the transfer.
How do appraisers value solar panels?
For owned systems, appraisers following current guidance treat the system as a home improvement and can use comparable sales, the income approach (capitalized energy savings), or the cost approach (system cost minus depreciation). In practice, many appraisers undervalue solar — the Berkeley Lab researchers themselves flagged that consistent valuation methods were still catching up — so sellers should provide the system datasheet, installation paperwork, and a record of utility savings.
By how much do solar panels increase home value?
Reported study ranges vary. Berkeley Lab reported roughly $4 per watt of premium for owned systems (about $15,000 on a typical 3.6 kW system) in 2015-era data, and an NBER study of California homes found premiums of 3-4% of sale price. Treat both as historical study ranges, not guarantees: they reflect older system prices and specific markets, and real-world premiums depend on system age, size, and local power costs.
Do buyers pay more for homes with solar panels?
Research suggests willing buyers do, for owned systems. The Berkeley Lab study found buyers consistently paid the premium across boom, bust, and recovery markets, and the effect was larger for existing homes than new-build homes — resale buyers seemed to value an operating system more than new-build buyers did. In practice, expect more interest in high-utility-cost markets and markets with strong solar awareness.
Should I buy out my solar lease before selling?
Often, but run the numbers. A lease buyout converts the system to owned, which can then be appraised as part of the home and avoids forcing a buyer to qualify for a lease transfer. Compare the buyout cost against the likely appraised premium and any buyer resistance to the transfer. If the buyout is expensive and the system is small or old, selling with a cleanly documented transfer may be the simpler path.
Do solar panels ever hurt home value?
An owned, well-documented system rarely hurts value — the main risks are a leased system that limits your buyer pool, an old system near the end of its inverter's life, or roof problems the panels complicate (re-roofing under an array costs more). None of these are value-killers in most markets, but a leased system you cannot cleanly transfer is the scenario most likely to cost you time and negotiating leverage.
Run your own numbers
The resale premium is the bonus — the real return is your monthly savings. Model your system cost and payback with the free calculators before you decide.