Selling a Home With Solar Panels
This is a very popular topic here in Arizona. We get over 300 days a year of sunshine so you would think solar panels would be installed on every home right? Well, that’s not the case.
For roughly $20,000 or so a homeowner can purchase or lease solar panels. While it may save you money on your electric bill, solar panels don’t bring the value you may expect when you go to sell your home.
If you opt to purchase the solar panels and you sell your home, you may add some value to your home. If you can produce evidence that the solar panels are indeed lowering your monthly bills compared to a similar home. Your may see a value increase of up to 2-3%.
However, if you lease your solar panels, you may see a decrease in your home’s value compared to a home that does not have solar. The reason being is because an interested buyer will need to not only qualify to purchase the home but also qualify to take over the lease of the solar panels. This lease amount could be hundreds of dollars a month. Any potential buyer will need to determine if it is worth it to them or not. What this does is decrease the amount of potential buyers interested in your home. In most cases, it means your home may sit on the market longer and/or sell for less money. Mike Orr, an analyst with Arizona State University’s W.P. Carey School, reviewed recent solar home sales for The Arizona Republic and azcentral.com said. “A leased solar power system can detract 3 to 8 percent from the value of a metro Phoenix home.”
One reason homes with solar panels aren’t selling for more money is because Fannie Mae updated its requirements for properties with solar panel systems. The mortgage-buyer clarified that leased panels may not be included in the appraisal value. This is a huge blow to those with solar panels because government-owned Fannie Mae and Freddie Mac back nearly half of the home-purchase mortgages in metro Phoenix area. For many buyers, they are the best loan option with the lowest interest rates. Mike Orr said Fannie Mae’s move to not allow appraisers to include solar panels in their valuations is one more reason leased panels appear to detract from a home’s resale value.
Keep in mind, when you add a pool to a home, it’s common to pay up to $30,000 to have one installed but when you go to sell you’ll only get approximately $10,000 for it. Solar panels are no different. Just because you paid X amount of dollars for something in hopes of increasing your homes value, does not mean you get every penny back.
Approximately 75% of solar panels installations in the APS area are leases. The reason for this is because leases don’t require a huge upfront investment. Almost 2 percent of the region’s houses for sale during the past year were equipped with rooftop solar, according to Orr’s analysis.
So if you are thinking about having solar panels installed, keep your home’s resale value in mind. If not, you may loose value which means less money in your pocket when you sell.
For questions on selling your home with Solar Panels, please give me a call at 480-229-5861 or email RealtorLaurelJ@gmail.com
Laurel Jonas 480-229-5861 RealtorLaurelJ@gmail.com