By now we all know the immediate and long-term benefits of switching to solar power. For many, meaningful savings is seen in the first year, which grows over time as utility rates continue to increase. We also know solar homes reduce emissions significantly, however, what many do not realize is that going solar has huge benefits when selling your home. 

In 2018 and 2019 a nationwide study by Zillow showed homes with solar energy systems sold for an average of 4.1% more than comparable homes without solar, and in Florida, the premium was even higher at 4.6%. For today’s median-valued Florida home of $355,000, that equates to over $16,300 in home equity! 

Solar-powered homes have also been shown to sell faster, which reduces carrying costs. Think about it. If you have two identical homes, and house “A” comes with a perpetually increasing utility bill of $200 and home “B” has no utility bill or a lower fixed payment, the buyer can afford more knowing their monthly expenses are going to be reduced and predictable. Personal preferences also play a role. More than 80% of homebuyers say energy-efficient features are important, according to the Zillow Group Consumer Housing Trends Report.

The sale premium varies by market. In Riverside, California, for example, homes with solar-power systems sold for 2.7% more than comparable homes without solar power—a markup of $9,926 for the median-valued home in the market. In the New York City metro area, solar-powered homes have a premium that is double that of Riverside. At 5.4%, that is an extra $23,989 in value for the typical home in New York. In three other coastal metro areas—Los Angeles, San Francisco and Orlando, Fla.—homes with solar power sell for a premium of around 4-5%.

Methodology

Zillow calculated the solar premium by comparing homes with and without solar-energy systems that were sold from March 1, 2018, to February 28, 2019, controlling for observable attributes of the homes, including bedrooms, bathrooms, square footage, age of the home and location.