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I'm selling my house with solar panels - how do I get the most value?

Posted by Jordan Willis on 5 September 2017 at 2:23 pm

Solar panel installation is a commitment in more ways than one. While the initial cost of installing solar PV onto your home is often repaid in energy savings and a Feed-In Tariff, a second sense of commitment comes from necessary time spent in one house to see a return on your investment. The life of a solar panel usually reaches upward of 20 years and the average Brit moves house 8 times in their life, so selling a house with solar panels must be a common occurrence. While one may imagine that selling a house fitted with solar PV would instantly boost its market value to recognise the energy saving and earning potential of the property, the reality can sadly be a little different.

If you are planning on selling up within 20 years of installing solar PV, then normal practice is for feed-in tariffs to automatically be transferred onto the new homeowner. For more information on this topic, read our specific blog about feed-in tariffs. Thus, it is likely that the cost incurred by installing solar panels has to be recouped through an increased sales value. Though there are circumstances whereby you can keep financial control of the feed-in tariff, similar plans have been wrought with technical and legal difficulties for the new homeowners.

A recent study from the USA showed that there was an increase in house prices (of about $4000/kW) across eight states for houses selling with solar technology. Studies in the UK have also noted correlations between energy efficiency ratings and sales values. All of this is encouraging news for a return on investment on selling a house with solar panels, but all may not be as simple as it seems.

In 2015 the Solar Trade Association (STA) spoke to a wide range of people, including the Registered Institute of Chartered Surveyors, the Council of Mortgage Lenders, housing developers, builders and valuation surveyors, and unfortunately concluded “that there was a poor understanding of the cost/benefits that [solar PV] provided”. The STA described the RICS advice as “out of date and very generic, with no formal process for assessing the property in place, and the CML also provides very little direct advice on the issue. Housebuilders were broadly hesitant to install solar panels as they weren’t confident of a return on investment on the product.

All of this sounds rather bleak. However, while formal organisations may not be able to provide rigid processes for evaluating the value of solar panels, there are steps you as an individual can take. It is vital to provide your estate agent with as much information possible, and boil down the financial benefits of solar panels. Keep solid proof in the form of low electricity bills, FiT statements and EPC (Energy Performance Certificate) charts to give to agents and potential buyers. While estate agents often do very little to market the benefits of solar panels, and often the EPC isn’t requested by potential buyers, there is a host of evidence that suggests that an energy efficient home is a real selling point. Solar panels have been known to raise a house’s EPC rating by 2 grades, which one study suggests could raise the value of an average house by £16,000. Zero Carbon apartments sell for 2% more than their carbon producing equivalents, and it is estimated properties with solar PV could sell up to 30% quicker than those without. Obviously the value increase depends on the capacity and age of the solar panels, but these are certainly encouraging statistics.

The point remains that a lot of the effort to advertise these benefits must come from the individual homeowner. Direct information from trusted sources and local estate agents is often scarce, so while knowledgeable buyers may well be hugely enthusiastic about buying a house with solar PV due to the energy saving costs, making the buyers knowledgeable in the first place can be an issue. Making sure to provide the relevant documentation and providing easy to digest information about the benefits of solar PV to both buyers and agents is the best way to secure a proper valuation of the technology. Unfortunately, it seems that this will have to be another thing added onto the long to-do list when moving home!

Have you had experience selling your house with solar panels? Tell us about it in the comments section!

Looking to install solar panels on your house? Use our find an installer tool to find someone near you!

Need help with any Jargon?

 

Sources:

https://www.solarpowerportal.co.uk/news/mortgage_misfortunes_the_free_solar
_situation

http://www.theecoexperts.co.uk/how-will-installing-solar-panels-affect-value-my-house

http://www.yougen.co.uk/blog-entry/1763/What+happens+to+the+feed-in+tariff+when+you+sell+your+house/

https://www.zoopla.co.uk/discover/property-news/the-average-brit-will-move-house-8-times-801377088/

http://www.solar-trade.org.uk/wp-content/uploads/2016/01/Solar-Homes-Sales-Premium_Scoping-Study_Exec-Summary_final.pdf

https://www.solarguide.co.uk/solar-panels-what-happens-to-the-feed-in-tariff-when-you-move

http://www.theecoexperts.co.uk/how-will-installing-solar-panels-affect-value-my-house

http://www.theecoexperts.co.uk/freebook/chapter-10-selling-your-solar-powered-home

About the author:

Jordan is a full-time intern here at YouGen this summer, specialising in online marketing as well as driving the site forward as part of an ambitious development plan.

Jordan is interested in all aspects of energy and sustainability and has a strong background in social media marketing and engagement. 

If you have a question about anything in the above blog, please ask it in the comments section below.

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Comments

3 comments - read them below or add one

James Conolly

James ConollyComment left on: 3 November 2017 at 7:23 pm

My house sale has fallen through as the buyer could not grasp the value of the solar panels and the associated FIT. We got in early at max FIT rate but it cost us £ 11,000 for the installation of 18 panels and they generate around £ 1,500 per year in FIT payments. This still has 20 years to run so has a value to anyone of at least £ 30,000 over that time.

I had asked the  intendng purchaser to just make up the difference between what I paid and what I had got back - about £ 3,000 paid over 6 years and they could keep the rest but they backed off. Frankly I think this technology is so new that people and estate agents just don't understnd its value. So sadly on Monday morning I will be selling the FIT forward for about £ 10,000 so some financial instituion will get the best part of the money to be made.

My advice to anyone who is moving house just sell the FIT forward it's too difficult to understand for anyone who has  not lived with it and estate agents are no help at all in this situation.

 

James Conolly

 

 

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cannonballdaze

cannonballdazeComment left on: 14 October 2017 at 8:42 am

If I was selling, I'd have some reference to;

"your gas and electricity bills covered for 12 years"

e.g - FIT payments more than pay for the utility bills for the property - annual FIT payment = £1,600, bills = £600.

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James1957

James1957Comment left on: 4 October 2017 at 11:38 am

Thank you very much for this article. I'm about to sell a property with solar panels installed... and I didn't know they could raise the price such high :)

James

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