Do Solar Panels Actually Increase Home Value? The 2026 Data Says Yes — But How Much?

Here's a question that comes up in almost every solar consultation: "If I install solar panels now, will my home actually be worth more when I sell?"

The short answer: yes, significantly.

The longer answer — and this is what most installers won't tell you — depends on whether you own the system or lease it, where you live, how old your panels are, and whether you've got a battery attached. The numbers we're seeing in 2026 tell a clear story, but the details matter more than the headline percentage.

Let's look at what the latest research actually shows — and what it means for your wallet.

Quick pick: what's solar's impact on your home?

For a $400,000 home, a 4–7% premium translates to $16,000–$28,000 in added value from solar alone. On a typical $31,000 solar installation, that means you recover roughly half your upfront cost just from increased home value — before counting a dollar of electricity savings.

What the research actually says

Two independent bodies of work anchor this topic — and they're often confused with each other. Here's what each one really found.

Lawrence Berkeley National Laboratory: the per-watt benchmark

LBNL's landmark study "Selling Into the Sun" analyzed 22,000 home sales across 8 states between 2002 and 2013, roughly 4,000 of which had solar. Controlling for location, size, age, and other features with hedonic pricing models, it found solar added about $4 per watt of installed capacity — a premium of roughly 4.1% on a typical system of that era. Homes with solar also spent about 4% less time on the market.^[1]

That per-watt framing is more useful than a single percentage, because it scales: a 6 kW system and a 12 kW system don't add the same value. The study is older, but its methodology remains the reference point for later work.

Zillow: the current market numbers

Zillow's 2025 analysis puts the average premium for homes with owned solar at 6.9% — up from the 4.1% it measured in 2019. The strongest premiums showed up in Maryland (Baltimore metro, up to ~7.9%), New Jersey, New York, and Massachusetts — high-electricity-rate markets where buyers can immediately see the bill savings.^[2]

Zillow's consumer survey data also quantifies the lease problem: about 29% of buyers said they'd be less likely to purchase a home with leased solar.^[2]

National Association of Realtors: what buyers say

NAR's survey work finds solar consistently matters to buyers: 52% of homebuyers rated solar panels as "somewhat" or "very important" in their purchase decision, and in a 2026 survey of agents, 31% of realtors reported that solar adds value in their market.^[3]

Fannie Mae and the appraisal question

The practical bottleneck has never been buyer interest — it's appraisal. Fannie Mae and Freddie Mac (which back the majority of U.S. mortgages) accept three approaches for valuing solar-equipped homes:

• Income approach: present value of the electricity bill savings
• Cost approach: depreciated replacement cost of the system
• Comparable sales: solar vs. non-solar comps in the same market

The Appraisal Institute publishes Guide Note 10 specifically for appraising solar-equipped properties.^[4] In practice, whether you capture the premium at closing depends heavily on whether your appraiser knows this guidance exists — which is why we recommend asking your realtor to request an appraiser with solar experience (more on that below).

Where solar adds the most value

Premiums are largest where electricity is expensive and solar is common. Based on Zillow's 2025 analysis and LBNL's per-watt work:

These are planning estimates, not appraisals. Premiums vary by metro, system size, age, and local inventory conditions — a 12 kW system in a high-rate market will outperform a 4 kW system in a low-rate one.^[2][5]

The dollar effect is largest in expensive housing markets. In California, a 6% premium on a $780,000 home is roughly $47,000 — more than the cost of a typical solar installation.

Owned vs. leased: the biggest factor

Here's the single most important finding: who owns the solar system matters enormously.

Owned systems

When you own your solar panels — whether you paid cash or have a paid-off solar loan — they're treated like any other home improvement. An appraiser adds a value adjustment based on the system's expected energy production and remaining useful life. The premium is real and consistent.

Leased systems and PPAs

When your solar panels are leased or under a PPA, things get complicated. The system is still on your roof, but you don't own it — the leasing company does. This creates several issues when selling:

• Buyer qualification: The buyer must qualify for the lease/PPA transfer, adding a step to the sale process.
• Appraisal challenges: Some appraisers don't handle leased-solar adjustments well, and a leased system generally isn't eligible for the same value adjustment as an owned one.
• Buyer resistance: Some buyers actively avoid homes with solar leases because of the additional paperwork and the unknown long-term cost of the lease.

The data is consistent: homes with leased solar generally sell for about the same as homes without solar — no premium, no discount — but with extra friction. Zillow's survey found roughly 29% of buyers said they'd be less likely to buy a home with leased solar, and lease transfers add paperwork and a qualification step to closing.^[2]

If you're selling a home with a solar lease or PPA: be proactive. Disclose the terms clearly, provide the lease transfer paperwork in advance, and consider offering to buy out the remaining lease term if it makes the sale easier.

Do batteries add value beyond solar panels?

The honest answer: there is no rigorous study yet that isolates how much a battery adds on top of the solar premium. The one-time, non-exportable battery credit that used to exist for storage expired alongside the residential solar credit at the end of 2025, which has also slowed the data collection on resale effects.

What is well established is the direction: in outage-prone markets — Texas (ERCOT), California (public safety power shutoffs), and Florida (hurricane season) — backup power is a tangible feature that buyers ask about, and realtors report it as a differentiator. In markets where outages are rare, expect little or no incremental premium.

In practical terms, treat it this way:

What affects solar's value impact

Not all solar installations are equal when it comes to home value. Here's what matters most:

System age

Solar panels degrade slowly — about 0.5–0.8% per year in efficiency.^[7] A 5-year-old system is still 96–98% as efficient as new. An 15-year-old system might be at 88–90%. The value impact decreases gradually as panels age:

Key point: even 15-year-old panels still add value. They produce less than new panels, but they produce free electricity — and that's worth something at any age.

Roof condition

If your roof needs replacing in 3–5 years, the solar panels will need to be removed and reinstalled. Buyers factor this into their offer. Ideally, replace the roof before installing solar, or at least before listing the home for sale. A new roof + new solar is a powerful combination for resale.

System quality and size

A professionally installed 12 kW system from a reputable installer adds more value than a DIY 4 kW system. Buyers (and appraisers) look at:

• Panel brand (Tier 1 manufacturers like SunPower, LG, Panasonic command higher premiums)
• Inverter type (microinverters or power optimizers are valued more than string inverters)
• Warranty transferability (25-year production warranties that transfer to new owners are a selling point)
• Monitoring capability (smart monitoring shows the system is producing as expected)

Location and local electricity rates

Solar adds more value in areas with high electricity rates because the system saves the buyer more money each month. A 12 kW system in California (32¢/kWh) saves the homeowner ~$3,800/year in electricity. The same system in Texas (14¢/kWh) saves ~$1,700/year. The higher the savings, the higher the home value premium.

Should you wait to sell before installing solar?

This is a common question, especially from homeowners thinking about selling within a few years. Here's the math:

The caveat: if you're selling within 3 years, your solar installation might not pay for itself. But it could make your home more attractive to the right buyer — particularly younger buyers or environmentally conscious purchasers.

How to maximize solar's value when selling

If you've installed solar and are planning to sell, here's how to get the most value:

1. Provide documentation: Give potential buyers your installation contract, warranty info, monitoring data, and 12 months of electricity bills showing the savings.
2. Highlight the numbers: "Your monthly electric bill: $0–$25 (grid connection fee only)."^[8] That's a powerful selling point.
3. Choose the right appraiser: Ask your realtor to request an appraiser experienced with solar homes, and point them to the Appraisal Institute's Guide Note 10 (solar valuation) plus the Fannie Mae/Freddie Mac solar appraisal guidance.^[4][9]
4. Keep it clean and maintained: A dirty or damaged system looks like a liability. Clean the panels (professional cleaning is ~$150–$250) and get any inverter issues resolved before listing.
5. Transfer warranties: Ensure all manufacturer warranties (panel production, inverter) are properly transferable and paperwork is ready.

Frequently asked questions

Does the expired federal tax credit affect home value?

No. The tax credit (or lack thereof) affects your cost to install, not the value of the system once installed. A solar panel produces the same amount of electricity whether you got a tax credit or not. Buyers care about the ongoing savings, not your purchase price.^[10]

Can my HOA force me to remove solar panels?

In most states, no. As of 2026, more than 30 states (plus DC) have solar access laws that limit HOA restrictions on solar installations — though the exact count varies by source and by how strictly "solar access law" is defined. Some protect single-family homes only; others extend further. HOAs can still impose reasonable aesthetic requirements, such as panel placement away from street-facing roofs.^[11]

Do solar panels help if I rent instead of sell?

If you rent out your home, solar can be a meaningful differentiator with tenants, since it directly lowers their monthly utility cost. Rigorous research on rent premiums is limited — treat the "solar rents for X% more" claims you see online with skepticism — but in competitive rental markets, a listing that advertises a low or near-zero electric bill stands out. Cover the system's maintenance and monitoring in your lease so the tenant isn't responsible for equipment they don't own.^[12]

Will solar panels become a standard expectation for home buyers?

Many experts think so. In new construction, solar is already standard in several states (California requires solar on most new homes under its 2023 Building Energy Efficiency Standards^[13]). Over time, we expect solar-plus-storage to become as standard as central air conditioning — a feature buyers expect, not a premium add-on.

Bottom line: solar pays for itself — twice

Here's the complete picture:

• First payment: Electricity savings of $1,500–$3,000 per year, compounding as utility rates rise — $30,000–$50,000+ in direct savings over 25 years.
• Second payment: A resale premium of roughly 4–7% in most markets — $16,000–$50,000+ depending on your home price and local rates.

That's a combined return on the order of $45,000–$100,000 on a ~$31,000 installation — before counting the resilience value of backup power if you add a battery.

The key is owning the system. Leased or PPA solar doesn't deliver the same value. If you're on a lease and planning to sell, consider buying out the remaining term — it could be the difference between a quick sale and a lingering listing.

Want to calculate your specific solar savings — including the home value impact? Try our Solar Savings Calculator for a personalized estimate.

Sources

1. LBNL, "Selling Into the Sun: Price Premium Analysis of a Multi-State Dataset of Solar Homes" (Hoen & O'Connell), 2015. lbl.gov
2. Zillow, "Solar Value Report," 2025 (and 2019 baseline). zillow.com
3. National Association of Realtors buyer and agent surveys (2021 Member Profile; 2026 agent survey). realtor.org
4. Fannie Mae / Freddie Mac appraisal guidance for properties with solar; Appraisal Institute Guide Note 10. fanniemae.com
5. LBNL per-watt solar premium analysis, as cited above. lbl.gov
6. Zillow consumer survey on leased solar (buyer resistance), 2025. zillow.com
7. NREL, "Photovoltaic Degradation Rates — An Analytical Review." nrel.gov
8. U.S. Department of Energy / HUD solar home sales case studies. energy.gov
9. Appraisal Institute Guide Note 10: Appraising Solar Photovoltaic Systems. appraisalinstitute.org
10. IRS guidance on the expired residential clean energy credit and basis treatment. irs.gov
11. DSIRE Solar Access Laws database, 2026. dsireusa.org
12. Zillow rental market research, 2025. zillow.com
13. California Title 24 Building Energy Efficiency Standards (solar requirement for new homes). energy.ca.gov