As solar power technology has improved over time, its long-term economic benefits have become more significant to any home or business looking to install solar panels on their property.
But solar power investments can also offer short-term financial gains when it comes to increasing the property value of your home. Although most homeowners who install solar panels have plans to stay in that home for years to come, the property value boost from installing solar panels can offer yet another way to profit from this investment.
Even if you do sell your home earlier than you intended, you’ll be able to pocket more money from the sale thanks to your solar energy solutions. Read on for more information about the different ways solar power generates value for your home.
What is the Average Cost for Solar Panels?
While the price of solar panel installation can vary significantly from one home to the next, a typical solar panel installation project will cost between $15,000 and $25,000. The more energy your home consumes, the higher the estimated cost.
This estimated cost does not include any potential tax credits, grants or other financial support you may be eligible to receive. With the federal tax credit for solar panels currently set at 26 percent, a $25,000 installation project would be eligible for $6,500 credit to defray the cost of installation.
Calculating Your Solar Panel Return on Investment
While the up-front cost of solar panel installation may concern some homeowners leery of that level of investment, it’s important to keep in mind the financial returns that could be reaped for years, even decades to come.
These financial rewards come in more than one form, but the totality of this value must be accounted for when weighing the long-term value of solar panels. Homeowners considering solar panel installation should be mindful of the following benefits:
- Total energy savings per month. In many cases, homeowners are able to source 100 percent of their home’s energy needs from their solar panel investment, effectively eliminating some of their monthly utilities costs and saving thousands of dollars every year.
- Length of time to turn a profit on your investment. Depending on the cost of your solar panel project and the monthly savings on your energy bill, many homeowners break even on their investment within 10 years, and sometimes even faster.
- Estimating the increased value of your home. While some of the financial rewards of solar panels take years to be realized, this installation project will have an immediate impact on your home’s potential sale price. The bump in market value from this upgrade will likely increase your home’s value by thousands, further reducing the net expense of solar panels—and accelerating the timeline for turning a profit.
When you purchase solar panels for your home, your home’s potential sale value could increase significantly. Experts estimate that the average Florida home could see an increase of value of around four percent just by adding solar panels to that property.
On a $300,000 home, that’s an increased home value of $12,000—which might easily account for half or more of your solar investment. In certain communities, the impact of solar panels on your home’s value might stretch even higher, creating excellent value out of your investment when combined with your energy savings over time.
Even if you don’t plan to sell your home soon, a higher potential sale value gives you options and flexibility. If you need to sell your home earlier than anticipated, you can recoup a huge chunk of your investment—and potentially still turn a profit—thanks to your increased home value.
This upgrade also increases the available equity in your home, which can increase your ability to take out a second loan or tap your home’s equity for home projects or other purposes.
If you’re ready to install solar panels on your home—or if you’re interested in at least getting a quote and learning more about your options in connecting your home to solar power—your first step should be to connect with a solar panel installation company that offers free assessments of your home and energy needs.
Interested in solar panels for mobile homes? While mobile home installation projects are a little different from traditional homes and buildings, it’s still possible, in many cases, to set up solar paneling that supplies this home with sufficient power throughout the year. A professional installer can evaluate your specific building and offer recommendations and cost estimates.
When you invest in solar power, the financial gains of greater energy independence could enrich you for as long as you own the home. And when you do finally sell, you’ll receive a nice payout thanks to the green energy upgrades you made to that property years earlier.