Owned solar panels increase home value by roughly 4 percent on average, according to the best available research. Leased systems are a different story entirely, and in some markets they complicate a sale rather than helping it.
- Berkeley Lab research found owned solar adds about $4 per watt to resale value, roughly $15,000 on an average system.
- Zillow found homes with solar sold for 4.1 percent more on average, with bigger premiums in some major metros.
- Leased and PPA systems generally add little value and can complicate sales, because buyers must qualify to assume the contract.
- Appraisers value solar using income or paired-sales methods, but many still lack good comparable sales data.
- The premium is strongest where electricity is expensive and net metering is favorable.
The Short Answer
If you own your solar panels outright or through a loan, they add measurable resale value in most US housing markets. If you lease them or signed a PPA, assume they add nothing and budget time for the contract transfer, because the buyer has to agree to take over your payments.
The size of the premium tracks the value of the electricity the system produces. In high-rate states like California and Massachusetts, the premium runs above average. In low-rate states with cheap grid power, it runs below average, sometimes well below. Our bill savings guide explains the underlying math that appraisers are really pricing.
What the Research Actually Found
The most cited study comes from Lawrence Berkeley National Laboratory, which analyzed thousands of home sales and found that owned photovoltaic systems added about $4 per watt of installed capacity to resale value. On a typical 6 to 7 kW system, that is $24,000 to $28,000 in the study’s markets, though the premium depreciates as the system ages, falling by roughly $2 to $3 per watt for older systems.
Zillow’s analysis of its own listing data found homes with solar energy systems sold for 4.1 percent more on average than comparable homes without, with metro-level premiums ranging from under 2 percent to over 5 percent. The highest premiums clustered in markets with expensive electricity and strong solar adoption, places like Los Angeles, San Diego, and Honolulu, where buyers already understand the bill savings. Lower premiums showed up in markets with cheap grid power, where the monthly savings are smaller and buyers discount them accordingly. A 2024 follow-up covering the pandemic-era market confirmed the premium persisted even as home prices surged overall. Both studies control for the usual confounders as best as observational data allows, but neither is a randomized trial. Treat the numbers as well-supported estimates, not guarantees for your zip code. The Berkeley Lab Electricity Markets and Policy group publishes the underlying reports for anyone who wants the methodology.
Owned vs Leased: The Value Split
| Factor | Owned (cash or loan) | Leased / PPA |
|---|---|---|
| Resale premium | ~$4/watt, ~4% of home value | Little to none in most studies |
| Buyer perception | Asset that lowers bills | Contract obligation to assume |
| Sale complexity | Standard disclosure | Buyer must qualify with the lease company |
| Appraisal treatment | Valued as improvement | Often excluded from value |
| FHA/VA loans | No issue | Can complicate approval |
The leased column deserves emphasis because it surprises sellers. A lease or PPA is a 20 to 25 year contract with escalating payments. When you sell, the buyer must pass the solar company’s credit check and agree to the remaining payments, and some buyers simply refuse, shrinking your buyer pool. Real estate agents in solar-heavy markets report that leased systems add days on market even when they do not reduce the price. If you are choosing between financing options now, our lease vs purchase guide covers the long-term trade-offs beyond the monthly payment.
How Appraisers Value Solar
Appraisers have three standard approaches, and solar exposes the weaknesses of each. The paired-sales method compares your home to recent sales of similar homes with and without solar, which works well in solar-dense neighborhoods and poorly everywhere else. The income approach capitalizes the system’s annual energy savings into a present value, which is the most theoretically sound method for solar but requires the appraiser to trust a savings projection. The cost approach estimates replacement cost minus depreciation, which tends to undervalue older systems.
In practice, many residential appraisers still lack training in solar valuation and default to conservative numbers or ignore the system entirely. This is slowly improving as solar becomes common enough that paired sales exist in more neighborhoods, and as lenders ask more questions about energy features. But in 2026 you should still assume the appraiser needs education, not that they arrive with it. You can help your own appraisal: provide the original contract showing the cash price, 12 months of pre- and post-solar bills demonstrating the savings, the system’s production data, and warranty documentation. An appraiser handed a clean income calculation is far more likely to credit the system than one left to guess. If you are refinancing rather than selling, the same package helps the bank’s appraiser, and the stakes are identical because the loan amount depends on the appraised value.
What Does Not Add Value
A few things homeowners assume add value but generally do not. An oversized system beyond your usage adds little, because the appraiser values savings, not capacity, and export credits above your consumption are worth less. For the math behind those savings, see our honest 2026 payback breakdown. Battery storage adds some value in outage-prone markets but has thin comparable-sales support so far, so expect conservative appraisals. And a system near the end of its inverter life, around year 12 to 15 for string inverters, gets discounted for the coming replacement cost.
Age matters in a predictable way. The Berkeley Lab data shows the premium declining as systems age, which makes sense: a buyer in 2026 discounts a 2018 system for its remaining life. Well-maintained systems with transferable warranties and monitoring access hold value best. Keep your documentation organized from day one, because the seller who can hand over production history and warranty papers captures more of the premium than the one who cannot find the installer’s phone number.
Does the Math Hold in 2026
The end of the federal 25D credit for post-2025 installs raises a fair question: if solar costs buyers more now, does the resale premium shrink? Probably not much, and possibly not at all. The resale premium reflects the value of the electricity the system produces, not the original installed cost. A buyer in 2028 comparing your solar home to a non-solar home cares about the $150 monthly bill difference, not what you paid in 2026.
If anything, higher post-credit install costs support the premium, because the replacement cost of the system is higher. What could erode the premium over time is changes to net metering that reduce the savings stream, since appraisers using the income approach will project smaller savings. That is a state-by-state story, and it argues for checking your utility’s export policy before banking on the top end of the premium range. Buyers are also getting savvier about asking for production data, so the documentation habits that protect your premium start on installation day. The EnergySage marketplace data on local pricing can help you calibrate expectations for your market.
Should I install solar before selling my house?
Usually not as a flip strategy. The premium roughly tracks the system’s depreciated value, so you rarely profit on a brand-new install at sale. Install solar because you want the savings while you live there; the resale premium is a bonus, not the business case.
Do I need to disclose the solar system when selling?
Yes. Solar is a material feature of the property, and most states’ disclosure forms ask about it explicitly. Disclose ownership versus lease status, the installer, warranty terms, and any remaining loan balance.
Can a leased solar system kill a home sale?
It can delay or complicate one. The buyer must qualify to assume the lease, and some buyers refuse. Sellers sometimes buy out the lease at closing to simplify the transaction, which is worth pricing into your decision.
How do I document my system for the appraiser?
Assemble the original contract, equipment spec sheets, 12 months of utility bills from before and after installation, production monitoring data, and all warranty documents. Hand the package to the appraiser directly.
Ready to compare real solar prices?
Get free, no-pressure quotes from vetted local installers and see what solar costs for your roof.
