Does Solar Increase Home Value?There is a new 30% tax credit to install solar panels and battery storage at your home in the Inflation Reduction Act. This credit is available starting January 2023.
Do Solar Panels Increase the Value of My House?
Dated: August 27 2022
Does Solar Increase Home Value?
There is a new 30% tax credit to install solar panels and battery storage at your home in the Inflation Reduction Act. This credit is available starting January 2023. Between this attractive tax credit and increasing energy costs we expect the demand for solar power to increase over the next few years.
As REALTORS®, our clients want to know how much installing solar panels will increase the value of their home. Unfortunately in Southern Delaware the answer is; they don't. Homebuyers in our market like solar panels. The majority are not willing to pay a material amount more for a home with solar vs a home without solar panels.
Are Solar Panels Worth Installing?
The answer is, maybe. The new tax credit in the Inflation Reduction Act is very attractive. As a generic example. A homeowner who is able to make full use of the tax credit on a $20,000 solar project would see the effective cost drop to $14,000. If that same homeowner has a $200 monthly electric bill that goes to zero then the panels will take a little less than 6 years to pay for themselves. If that homeowner plans to stay in their home longer than 6 years, doing that project might be a great choice.
I don't provide tax advice and your individual circumstances will vary so please talk to your CPA to see how the tax credits work with the specific project you're contemplating.
You may just want to do a solar project because of environmental concerns. If you decide those concerns are worth it to you, it's a great reason to do a solar project.
When Does Solar Cause Problems?
We caution our clients to tread carefully before leasing or financing a solar project. In Southern Delaware there is a near certainty that you will need to buy out your solar project's financing before you sell your home. It might be the buyer's demand or a requirement of the solar company who won't allow that agreement to be transfered to another person.
If you haven't done your homework before you signed the agreement, you will likely be in for some sticker shock. The buyout terms for these agreements can be jaw dropping. We advise all of our clients to take the agreements for any solar project you're thinking about to an attorney of your choice. Have the attorney review the documents and explain to you what you're agreeing to before you sign.
Where Do I Start If I Am Interested In Solar?
If you're interested in this type of project but don't know where to start, please reach out. We have a large network of Attorneys, CPA's, and Solar Contractors who are reputable and we are happy to make an introduction to a few so you can make an educated decision.
Craig Beebe’s family are multi-generation Sussex County residents. Craig was born in Wilmington, Delaware while his Dad finished his residency in family medicine. They moved back full-time when Crai....