Over the past decade or so, solar panels have become the ‘must-have’ for any energy-conscientious UK householder. However, before you go ahead and get them installed, it’s important you ask the question “do solar panels add value to your home?”.
As the technology behind solar energy has improved, more people have had them installed. That’s brought the cost of installation of solar panels down significantly. In fact, the cost of solar panels has fallen around 10% almost every year since the 1980’s (source).
With the ever-increasing costs of gas and electricity, more and more people are turning to renewable energy. And that’s leading to a dilemma for UK estate agents – do solar panels increase the value of a property? If so, how much do they add? If they don’t add value then could they actually have a negative effect?
So without further ado, let’s take a closer look and try and answer the question “do solar panels add value to your home?”.
How Solar Panels Could Add Value To Your Home:
It may not be surprising, but, the main reason solar panels could add value to your home is probably the same reason you got them installed in the first place. Cheaper energy.
Everyone wants to find ways to save on their energy bills. The requirement for properties listed for sale to have an Energy Performance Certificate (EPC), makes energy efficiency a key consideration for many people.
By having solar panels, you’ll gain a better score on your EPC and your property will become more attractive to buyers. Not only that, they’ll get the benefits immediately without any of the cost or hassle of installing them.
For this reason, it seems like a no-brainer. Having solar panels adds value to your house, right? Well, possibly, but it’s not quite as clear-cut as that.
Could Solar Panels Decrease The Value Of Your Home?
Believe it or not, despite the significant investment you are making, it’s possible that solar panels are actually a bad thing when it comes to the value of your home.
How solar panels could reduce the value of your house:
- Eyesore. Not everyone likes the look of solar panels.
- Maintenance. From cleaning, through to repairs, some people don’t want the perceived hassle.
- Feed in Tariff. If it’s not possible to pass this on to the new owner, they may not be able to get a mortgage as easily.
- Added complications. If the prospective owner wants to retile the roof or build an extension, the panels may make it more difficult and costly for them to do so.
- Rental properties. If the buyer isn’t going to be living in the property themselves, solar panels may seem like a hassle they don’t need.
A lot will come down to how old your panels are and the decisions you made when they were installed. Most panels have a lifespan of around 20-25, if yours are approaching that age the new owner will have to consider the costs of replacing or removing them.
Who receives the Feed in Tariff is also important. This is an incentive offered to solar panel owners to essentially ‘sell’ their unused solar energy back to the grid. To reduce installation costs, many homeowners agreed to let this income go to the installers.
In essence, they are renting out their roof space to a solar energy installer, in return for cheaper electricity. This can make it more difficult to get a mortgage on a property. It also reduces the amount of money the homeowner could save.
Do Solar Panels Add Value To Your Home? The Verdict
There are both pros and cons of having solar panels when it comes to the potential impact on the value of your property. This makes it hard to definitively answer the question “do solar panels add value to your home?”.
If you have a relatively new system, with several years lifespan left on the panels, and you have full ownership of both the panels and the Feed in Tariff, then the panels shouldn’t decrease the value of your home. This is because the negatives will be balanced out by the positives.
Whether they add much value is debatable. A lot will depend on the area you are in, as to how desirable renewable energy in the home is. If most of your neighbours have solar panels, a ‘keeping up with the Joneses effect’ may come in and mean that solar panels are a ‘must-have’ for any new owners.
Therefore, if you are still deciding whether to add solar panels to your home, our advice would be to do it, but only if you plan on living there for the next 10-15 years. In this time, your savings will probably outweigh your costs. Plus, solar panels are becoming more and more common, and so in 10-15 years time, their effect on property prices may have changed.
If you were thinking of installing solar panels purely to increase the value of your property, think again. It’s highly unlikely that you’ll recover the costs of installation, simply from an increase in the value of your home.