Selling Into the Sun: Reviewing the Berkley study
Updated: Jan 26, 2019
A Study Done at the Berkeley Lab Shines Light on Price Premiums for U.S. Solar Home Sales
Almost every homeowner I talk to, that is seriously considering solar, wants to know whether or not solar will increase the value of their home. Well luckily for me you don't have to take my word for it. Berkley Labs answers that question for us. Across 15 states and 22,000 homes they come up with a very clear answer. People are willing to pay a premium for host owned solar.
“ Our analysis offers clear support that a premium exists in the marketplace; thus, PV systems have value, and their contribution to home values must be assessed. We find that premiums in California are strongly correlated with PV system size and weakly correlated with PV system age, in other words larger systems garner larger premiums and older systems garner smaller premiums. We estimate that eac h 1-kW increase in size equates to a $5,911 higher Premium (p-value 0.000) and each year systems age equates to a $2,411 lower premium (p-value 0.087).”
As solar is a major passion of mine and knowledge of such is critical to my financial well being I have reviewed this study and have decided to give a brief synopsis because what I've found is quite interesting and reinforces what I've found in my own conversations with homeowners.
Solar Increases the Value of Your Home
For every kilowatt of solar you have on your roof, the value of your home increase by between $4,000-$6,000 the variables include the location of your home. The amount of sun hours your panels are receiving and the age of your panels. What this means for homeowners is that a solar loan is much like a mortgage. Every time you make a mortgage payment part of that payment is equity that you recoup when you sell your house. Installing solar allows you to increase the equitable investment you make each month meaning you can start getting something from where there was nothing. So stop giving your money to your electric company each month and start owning your own solar array. There really is no downside as long as you get adequate sunlight.