Do Solar Panels Increase Home Value? What the Data Says (2026)

If you are considering solar panels, the electricity savings are only part of the equation. A question that comes up in nearly every solar consultation is straightforward: will this investment make my home worth more when I sell it?

The short answer is yes — owned solar panel systems consistently increase home value. But the details matter enormously. Whether you own or lease the system, which state you live in, how the system is appraised, and how far along the panels are in their lifespan all influence exactly how much value you gain.

This guide pulls together every major study, real transaction data, and appraiser insight available in 2026 to give you a clear, evidence-based answer.

Table of Contents

1. The Big Picture: Solar Panels and Home Value
2. What the Research Says: Key Studies
3. Owned vs. Leased Solar: A Critical Distinction
4. How Appraisers Value Solar Panels
5. State-by-State Variation in Solar Home Value
6. Solar Property Tax Exemptions
7. Buyer Preferences: What Homebuyers Actually Want
8. Impact on Time-to-Sell
9. How to Maximize Your Solar Resale Value
10. FAQ: People Also Ask
11. The Bottom Line

The Big Picture: Solar Panels and Home Value

Solar panels are one of the few home upgrades that both reduce your operating costs and increase your property's market value. When a buyer looks at a home with owned solar, they see a house where the electricity bill is dramatically lower — sometimes near zero — for the next 15 to 25 years. That ongoing savings stream has a present value, and it shows up in the sale price.

The size of that premium depends on several factors:

• Ownership structure — owned systems add significant value; leased systems often add little to none
• System age and condition — a newer system with a transferable warranty commands a higher premium than an older system nearing end of life
• Local electricity rates — in states where utility rates are high, solar savings are worth more
• Local real estate market — in markets where buyers actively seek solar, demand drives the premium higher
• State policies — property tax exemptions and favorable net metering protect the financial upside

Let's look at what the data actually says.

What the Research Says: Key Studies

Two landmark studies form the backbone of what we know about solar panels and home value.

The Zillow Analysis: $15,000–$20,000 Premium

Zillow's analysis of millions of home sales found that solar panels add an average of 4.1% to a home's value nationally. On a median-priced U.S. home — approximately $400,000 as of early 2026 — that translates to roughly $16,000 in additional value. In a $600,000 market, the same 4.1% premium means approximately $24,600.

The premium held across different metro areas, was larger in markets with high electricity rates, and applied specifically to owned solar systems.

The LBNL Study: $4 Per Watt

Lawrence Berkeley National Laboratory examined roughly 23,000 home sales across eight states and found that buyers pay approximately $4 per watt of installed solar capacity. On a typical 7 kW system, that is roughly $28,000 for a new system.

The premium depreciates with age. A system operating for 5–7 years drops to approximately $2.50–$3.50 per watt ($17,500–$24,500 on a 7 kW system), which aligns with the Zillow data and confirms a real-world premium of $15,000–$20,000 for most homeowners.

What the Studies Agree On

Despite different methodologies, the conclusion is consistent: owned solar panels increase home value.

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Owned vs. Leased Solar: A Critical Distinction

This is the single most important factor in whether solar panels help or hurt your home's resale value. The difference between owned and leased solar is not a minor detail — it fundamentally changes the transaction.

Owned Solar Systems: Clear Value Add

When you own your solar panels outright — whether you paid cash or financed with a solar loan that has been paid off — the system is a permanent fixture of the property, like a new roof or an upgraded HVAC system. It transfers with the home at sale, and the buyer inherits both the equipment and the future energy savings.

Owned solar panels:

• Add $15,000–$20,000 to the typical home's sale price
• Transfer cleanly at closing with no third-party involvement
• Come with transferable manufacturer warranties (typically 25 years on panels)
• Are viewed by appraisers as a permanent improvement

If you still have an active solar loan, the remaining balance is typically paid off from sale proceeds at closing. The home value premium usually exceeds the remaining loan balance.

Leased Solar Systems: Potential Complication

Leased solar panels and PPA agreements are a different story. Because a third-party company owns the equipment on your roof, the system is not your asset to sell. Instead, the new buyer must agree to assume the remaining lease or PPA contract.

This creates several friction points:

• The buyer must qualify with the solar company to take over the lease. If their credit doesn't meet the company's requirements, the transfer can fall through.
• Some buyers refuse to take on a 15–20 year contract they did not choose. Real estate agents report that leased solar is one of the most common deal complications in markets with high TPO penetration.
• Appraisers typically assign no value to a leased system. Since it is not an owned asset, it cannot be included in the home's appraised value under standard appraisal guidelines.
• Buyout costs can be steep. If you need to buy out the remaining lease to close the sale, the cost can range from $5,000 to $15,000 or more depending on the remaining term and contract language.
• The closing timeline may extend by 1–3 weeks while the solar company processes the lease transfer paperwork.

This does not mean a home with leased solar cannot be sold — millions have changed hands successfully. But the complications are real, and you should factor them in if resale value matters to you.

The Value Comparison

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How Appraisers Value Solar Panels

If the appraiser does not properly account for the solar system, the home may appraise below the agreed sale price — which can jeopardize a deal that relies on conventional financing. Understanding how appraisers approach solar helps you protect your investment.

The Three Appraisal Approaches

1. Cost Approach — The appraiser takes the original installation cost, subtracts depreciation based on system age and remaining useful life, and adds that figure to the home's base value. Straightforward, but often undervalues solar because it ignores the ongoing income stream.

2. Income Approach — The appraiser calculates the present value of future electricity savings over the system's remaining lifespan, accounting for panel degradation and electricity rate increases. This method tends to produce the most accurate valuation.

3. Sales Comparison Approach — The appraiser compares the subject home to recently sold comps with and without solar. The challenge is finding enough solar home sales in the same market, especially in areas with low solar penetration.

The Appraisal Institute and Sandia National Laboratories developed the PV Value tool — a standardized calculator for the income approach that accounts for system size, age, degradation, and local rates. You can run it yourself and provide the output to your appraiser as supplemental data.

What You Can Do as a Seller

• Provide full documentation — installation contract, system specs, warranty certificates, and production history
• Share utility bills showing pre-solar and post-solar electricity costs
• Include a PV Value report or similar income-approach analysis
• Request an appraiser with solar experience if your lender allows it

State-by-State Variation in Solar Home Value

The premium that solar panels add to home value is not uniform across the country. Several factors create significant state-by-state variation.

High-Premium States

States where solar adds the most home value share common characteristics: high electricity rates, strong net metering policies, high solar adoption (which means more buyer awareness), and favorable property tax treatment.

Lower-Premium States

In states with low electricity rates, weak or no net metering, and low solar adoption — such as Louisiana, Alabama, West Virginia, and Kentucky — the premium is smaller, though it still exists.

The General Pattern

The solar home value premium correlates most strongly with local electricity rates. Where power is expensive, the future savings stream is worth more, and buyers pay a larger premium to capture it.

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Solar Property Tax Exemptions

One concern homeowners raise about solar increasing their home value is logical: if my home is worth more, won't my property taxes go up?

In many states, the answer is no — thanks to solar property tax exemptions.

How They Work

A solar property tax exemption means the assessor cannot increase your assessed value to reflect the solar installation. You capture the market value increase when you sell, but you do not pay higher taxes while you own the home.

Florida: A Case Study

Florida's solar property tax exemption is among the strongest in the country. Under Section 193.624 of the Florida Statutes, residential solar energy systems are 100% exempt from property tax assessment. This means:

• A $30,000 solar installation adds zero dollars to your property tax bill
• The exemption applies for the entire operational life of the system
• When you sell, the buyer still gets the market value premium from the solar panels
• The exemption transfers with the property — the new owner also benefits

In a state with an average property tax rate of approximately 0.86%, this exemption saves the homeowner roughly $260 per year on a system that adds $30,000 in assessed value. Over 25 years, that is $6,500 in avoided taxes — on top of the electricity savings and the home value premium.

States with Solar Property Tax Exemptions

The following states offer full or partial solar property tax exemptions as of 2026:

If you live in a state with a solar property tax exemption, the financial case for solar becomes even stronger: you capture the full resale value premium while paying nothing extra in annual taxes.

Buyer Preferences: What Homebuyers Actually Want

The home value data tells us what buyers are paying for solar. But survey data tells us what they want — and the numbers are overwhelming.

The Demand Is Real

According to a 2024 survey by the National Association of Realtors (NAR) and subsequent industry polling, 73% of homebuyers say solar panels are desirable in a home, and a significant portion say they would pay more for a home with solar installed.

More specific findings:

• 73% of buyers say solar panels are somewhat or very desirable
• 67% say they would prefer a home with solar over an equivalent home without it
• 40% say they would pay a measurable premium (typically $5,000–$15,000 more) for a home with owned solar
• Millennials and Gen Z buyers — who now represent the largest share of homebuyers — rank solar and energy efficiency among their top five home features

Why Buyers Want Solar

The demand breaks down into three drivers: financial (lower electricity bills in an era of rising utility rates), environmental (climate-conscious buyers actively seek solar homes), and convenience (avoiding the hassle of researching, permitting, and installing a system themselves).

What Turns Buyers Off

• Leased systems with high escalator clauses — buyers worry about payments increasing 2–3% annually
• Older systems with no remaining warranty — buyers discount panels near end of life
• Poor aesthetic installations — ground-mounted systems or panels that clash with the roofline
• Missing documentation — if the seller cannot produce installation records or production data, buyers become skeptical

Impact on Time-to-Sell

Beyond the price premium, solar panels also affect how quickly your home sells — and the data here is favorable.

Solar Homes Sell Faster

Multiple analyses, including data from Zillow and the National Renewable Energy Laboratory, indicate that homes with owned solar panels sell faster than comparable homes without solar. The exact speed advantage varies by market, but studies have found that solar homes spend approximately 20% fewer days on market on average.

In hot real estate markets with high solar adoption — such as parts of California, Arizona, Colorado, and New Jersey — solar homes can sell noticeably faster because buyer demand for energy-efficient features is high and the pool of solar-aware buyers is large.

The Leased Solar Exception

Homes with leased solar may take slightly longer to sell — typically 1 to 3 additional weeks — due to the lease transfer process. The solar company must approve the transfer, the buyer must agree to assume the contract, and additional paperwork must flow through both the real estate and solar company closing teams. Real estate agents experienced with solar transactions can mitigate these delays, but they remain a factor.

How to Maximize Your Solar Resale Value

If you already have solar panels or are planning to install them with future resale in mind, here are the steps that will maximize your return.

1. Own Your System

This is the single most impactful decision. Owned systems add $15,000–$20,000 in value; leased systems add little to none and can complicate the sale. If resale value is a priority, purchase your panels outright or via a solar loan — and pay off the loan before selling if possible.

2. Keep Impeccable Records

Maintain a file with the original purchase contract, panel and inverter specifications, all warranty certificates, annual production data from your monitoring system, and utility bills showing pre-solar and post-solar costs. This documentation makes the appraiser's job easier and gives buyers confidence.

3. Maintain the System

Keep panels clean, ensure the inverter is functioning, and address issues promptly. A well-maintained system with consistent production data is worth more than a neglected one, even at the same age.

4. Confirm Warranty Transfers

Before listing, verify that your panel and inverter warranties are transferable. Most Tier 1 manufacturers offer 25-year transferable warranties, but some require notification of ownership change.

5. Highlight Solar in Your Listing

Work with your agent to feature the system prominently: system size (kW), estimated annual production, average monthly electricity bill with solar, annual savings, remaining warranty period, and any monitoring dashboard the buyer can access.

6. Price It Right

The research supports a premium of 3–5% over comparable non-solar homes. Use the LBNL $4/watt figure as a starting point, adjust for system age, and let comps in your market guide the final number.

7. Prepare for the Appraisal

Proactively provide the appraiser with a PV Value report, production data, and comparable solar home sales. The more data you put in front of the appraiser, the more likely they are to fully capture the system's value.

FAQ: People Also Ask

Do solar panels increase home value in 2026?

Yes. Owned solar panel systems increase home value by approximately $15,000–$20,000 on a median-priced U.S. home, according to Zillow and LBNL data. The premium equates to roughly 4.1% nationally, though it varies by state and system age. Leased systems generally do not add meaningful value at resale.

How much do solar panels increase home value per watt?

The LBNL study found buyers pay approximately $4 per watt for a new system. The premium depreciates with age — dropping to roughly $2.50–$3.50 per watt for systems that are 5–7 years old. On a typical 7 kW system, that translates to $17,500–$28,000 in added value.

Do leased solar panels affect home value?

Leased panels generally do not add value and can complicate sales. Appraisers typically assign no value since the homeowner does not own the equipment, and the buyer must agree to assume the remaining lease and qualify with the solar company.

Do solar panels increase property taxes?

In many states, no. Over 30 states offer solar property tax exemptions that prevent your assessment from increasing. Florida provides a 100% exemption under Section 193.624. Check your state's policy before installing.

How do appraisers value solar panels on a home?

Appraisers use three methods: the cost approach (depreciated installation cost), the income approach (present value of future savings), or the sales comparison approach (comparing solar vs. non-solar home sales). The income approach, often calculated using the PV Value tool, tends to be most accurate.

Do buyers prefer homes with solar panels?

Yes. According to NAR data, 73% of homebuyers say solar panels are desirable. Millennial and Gen Z buyers rank solar among their top home features. The combination of lower bills, environmental values, and installation convenience drives strong demand.

Do solar panels help a home sell faster?

Homes with owned solar typically sell approximately 20% faster than comparable non-solar homes. The advantage is strongest in markets with high solar adoption and high electricity costs. Homes with leased solar may take slightly longer due to the transfer process.

Is it harder to sell a house with solar panels?

Not if you own the system. Owned solar makes your home more attractive to most buyers. Selling with a leased system is more complicated since the buyer must assume the lease, but experienced agents handle these transactions routinely.

The Bottom Line

The data is clear: owned solar panel systems increase your home's value by approximately $15,000–$20,000, help your home sell faster, and are highly desired by today's buyers.

The premium depends on owning — not leasing — your system. It varies by state, driven primarily by local electricity rates and solar adoption. And it requires proper documentation and an appraiser who knows how to value solar.

In 2026, with the federal residential tax credit expired and system costs borne entirely by the homeowner, the home value premium is an increasingly important piece of the financial equation. For a homeowner who pays $25,000–$30,000 for a solar installation, knowing that $15,000–$20,000 will be recaptured at sale — on top of years of electricity savings — makes solar one of the highest-ROI home improvements available.

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This article was last updated on March 22, 2026. Home values, solar costs, tax policies, and buyer preferences change over time. Consult a licensed real estate agent or appraiser for property-specific valuation advice, and a qualified solar installer for system-specific cost and savings estimates.