Solar increases resale value
Solar homeowners (both current and future) have an understandable practical question: what impact does the presence of solar have on the value of my home?
One would imagine that when comparing two very similar homes on the same street the home with a PV system would fetch a higher initial market valuation and ultimately a higher sale price. Unfortunately, studies that address this issue are not available in New Zealand, however in USA studies have been done on this important matter. But until recently those studies were limited in geographic scope and sample size. But in 2015 this lack of market intelligence was addressed by a groundbreaking study released by the Lawrence Berkeley National Laboratory. See here for the summary fact sheet of the full report: Lawrence Berkeley National Laboratory: Selling Into the Sun: Price Premium Analysis of a Multi-State Dataset of Solar Homes.
While past studies investigated individual neighborhoods with sample sizes up to 1,900 homes, the LBNL study sought to examine nearly 23,000 home sales and the impact of solar. Of these 23,000 home transactions roughly 4,000 had solar PV in eight states: California, Connecticut, Florida, Massachusetts, Maryland, North Carolina, New York, and Pennsylvania.
Across the sample of homes, LBNL found that on average homes with solar commanded a premium of about $15,000 USD (or roughly $4/watt) based on an average array size of 3.6kW. When converting these figures to the New Zealand situation, we need to take into account the fact that the installed cost of PV is about 40% less here than in USA. This new study means that we can now estimate that a home in New Zealand with solar could command a resale premium of about $9,000 NZD.
Note, this study only addressed solar on homes where the home owner had purchased the system outright. Some have surmised that buyers may stay away from homes with solar that was purchased on a lease arrangement. For a more up to date view on the value of homes with leased solar see Leasing Into the Sun A Mixed Method Analysis of Transactions of Homes with Third Party Owned Solar
For an Australian view of this topic please see Research conducted by Origin Energy and realestate.com.au that shows 85% of Australians understand that having solar power roof top panels will bring added value to a home.
Prior to 2016, there had been little investigation of this topic in New Zealand. But in 2016 the BRANZ research stream "Measuring the value of sustainability and resilience features in housing" surveyed 300 New Zealanders and published their findings. The report concluded that 70% of people who currently lived in a house with solar power and 50% of people who didn't yet live in a house with solar power would pay more for a house if it had solar power already installed. See BRANZ Study Report SR353.
- Created on .