Could adding solar power to your home raise its market value and fetch you more money on a sale? According to research conducted by the U.S. Department of Energy’s (DOE) Lawrence Berkeley National Laboratory, it could. The research indicates that California homes with photovoltaic (PV) systems sold for a premium from 2000 through mid-2009.
The study expresses the “PV premium” in terms of dollars per watt from an installed system. The numbers work out to approximately $3.90 to $6.40 per watt. That’s about a $17,000 bonus for a relatively new 3,100 watt PV system (which happens to be the average size of PV systems considered in the Berkeley Lab dataset), and compares to an average investment that homeowners have made to install PV systems in California of approximately $5 per watt during the study period.
The Berkeley Lab says its research is the “first to empirically explore the existence and magnitude of residential PV sales price impacts across a large number of homes and over a wide geographic area.” The study looked at more than 72,000 California homes that sold from 2000 through mid-2009, approximately 2,000 of which had a PV system at the time of sale.
Interestingly enough, the premium that solar systems bring to existing home sales doesn’t seem to translate to sales of newly built homes with solar. Peter Cappers, a Berkeley Lab researcher and co-author of the the study explains that the disparity could be due to the fact that home builders get value out of solar installations because they are a market differentiator that ends up speeding home sales. Cappers noted that this was “a factor not analyzed in the Berkeley Lab study,” and that “more research is warranted to better understand these and related impacts”
One can’t help but wonder, however, how well these numbers apply when considering the value of PV in home sales outside of the state of California. After all, as Berkeley points out, California has been and continues to be the country’s largest market for PV. The study shows that of the approximately 2,100 megawatts of grid-connected solar PV that have been installed in the U.S., nearly 1,000 megawatts of that installed capacity is in California. The data also shows that 90% of the of the almost 100,000 individual PV systems installed in California are residential systems.
Clearly, many California residents strongly value PV and it stands to reason that would factor into the value that is assigned to PV when considering home prices. This could indicate that a region’s PV adoption statistics may be an indicator for the level of PV’s influence on home sales prices.