Sales are hotting up… but do solar panels add to the value of a house?

Record numbers of households are installing solar panels in an attempt to rein in soaring electricity bills. More than 50,000 fitted them on their roofs in the first three months of this year alone – up by more than 100 per cent on the previous year.

Solar panels are usually a good investment if you plan to stay in your home for at least ten to 15 years after you install them.

This is because it generally takes that long to recoup the initial cost of installation from years of reduced electricity bills. Fitting typically costs around £5,500, or double that with a storage battery that allows you to keep surplus energy to use later.

However, you may not make the money back if you sell up sooner. Some potential buyers may see them as a valuable asset and be willing to pay more for a home with solar panels. Others will not recognise their value and may even pay less for a home with solar panels if they think they are unsightly.

We ask the experts when solar panels can can add to the value of your home – and when they may detract from it.

Added value?: Solar panels are usually a good investment if you plan to stay in your home for at least ten to 15 years after you install them

Keep old energy bills

To make solar panels more desirable to potential buyers, try to keep hold of old energy bills, suggests Jeremy Leaf, a former residential chairman of the Royal Institution of Chartered Surveyors (Rics) and a North London estate agent.

‘We are finding that solar panels don’t really make much of a difference to buyers, either encouraging them or putting them off a purchase, unless their benefits can be clearly demonstrated,’ he says.

For example, if you can show a buyer energy bills from before and after you installed solar panels, revealing that the panels have cut your bills by several hundred pounds, that could increase the saleability of your home.

He adds that if energy bills remain elevated for months or years to come, solar panels may become more of an attraction to potential buyers. ‘At the moment they are not making that much of a difference and the response from buyers is fairly neutral,’ he says.

However, Christopher Burton, head of sales at estate agents Knight Frank’s office in Dulwich, South-East London, is more positive about their appeal.

He says: ‘I would suggest that the initial cost of solar panels prohibits owners adding them now just to sell the house, but if they are already installed, it’s definitely considered a plus for the majority of buyers in our patch.’

Know your market

Solar panels could increase the value of a typical home by up to two per cent, installer GB Solar estimates. However, the uplift will vary according to the type of property.

Gareth Beard, director of GB Solar, says: ‘While there is some evidence that suggests solar panels do increase the value of a home, this varies very much on the area and the relative value of the home.’

Some types of buyer may be more comfortable with buying a property with solar panels than others.

Nigel Bishop is founder of buying agency Recoco Property Search, which specialises in period and Grade-listed properties. ‘Such properties are subject to limitations in terms of possible sustainable upgrades,’ he says.

‘When our buyers do encounter solar panels, however, this has not presented any negative feedback; particularly since homeowners are becoming increasingly aware of the benefits of eco-features.’ Jeremy Leaf adds that the aesthetics are more of a concern in some areas than others. ‘Solar panels in urban or suburban areas tend to deter buyers as they can look really ugly,’ he says.

Solar panels can be particularly attractive to buyers in parts of the country where energy bills are among the highest. Andrew Kerr, founder at boiler installer BOXT, says: ‘South Scotland was one of the areas worst-affected by electricity bill rises, experiencing a 53.72 per cent increase in just one year. Unsurprisingly, East Renfrewshire is the UK area with the largest increase in renewable energy installations between 2020 and 2021.’ If you are considering installing solar panels, you could ask your local estate agent how that is likely to be viewed by potential buyers should you sell in the years to come.

Growing interest

Solar panels with a battery storage system can be very attractive to buyers committed to keeping their bills down.

Electric vehicle owners similarly may seek out homes with solar panels and a charging point installed. However, as these technologies are still relatively new, there is just a handful of buyers who will be swayed by them. Matt Thompson, head of sales at Chestertons estate agents, believes that in time these renewable technologies will become attractive to a greater pool of buyers.

‘We encounter an increasing number of buyers who are looking for a property with good eco-credentials or sustainable features,’ he says.

‘Other buyers may not agree with the aesthetics of solar panels, but the industry continues to develop new concepts such as solar roof tiles which are a relatively new green energy technology and perhaps visually more attractive to some.’