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6 Things Every Agent Needs to Know About Solar Energy for Homes

May 23 2022

solar power houseSolar energy for homes is surging in popularity. The residential solar market saw its fifth consecutive record year in 2021, growing 30% over 2020. According to the Solar Energy Industries Association, homeowners remain motivated by increasing electricity bills brought on by more time spent at home, power outage experiences, and low financing costs to add solar features to their homes.

A Pew Research Center study revealed that the appetite for solar homes is high. While just 6% of U.S. homeowners say they have already installed solar panels at home, nearly half (46%) say they have given serious thought to adding solar panels to their homes in the past year.

Two factors are driving the solar housing marketplace. First, more homeowners are adding solar energy features. Second, home shoppers are looking to buy more energy-efficient homes to reduce their total housing expenses.

Real estate agents will need to become "solar savvy" about the unique features and benefits of solar-powered homes.

Here are six things every agent needs to know about solar energy for homes:

1. Solar homes sell for more: A U.S. Department of Energy study found that homebuyers throughout the U.S. are willing to pay more for a house with solar energy. Buyers were willing to pay $15,000 for a home with a solar system compared with a similar home without one.

2. Solar homes sell faster: An Appraisal Institute-sponsored study discovered that homes with solar panel systems stay on the market much shorter than homes without solar. Other studies have shown that new homes with solar installed sold twice as fast as homes without solar.

3. Benefits to sellers and buyers: Energy savings from a solar-powered home can be significant. Solar panels typically produce enough electricity to power at least half of an average-sized home, dramatically reducing annual energy costs. Solar homes also offer energy security. Solar homes deliver reliable energy in states like California and Texas with scheduled blackouts and/or energy surge pricing. Solar homes that become energy independent are never impacted by energy rate hikes. Finally, solar energy is clean energy, saving homeowners more than dollars – solar homes also help save the Earth.

4. Solar energy tax advantages: For more than 15 years, the Federal Solar Investment Tax Credit has given homeowners a significant one-time deduction on their federal returns.

In December 2020, Congress extended the tax credit, which, according to the U.S. Department of Energy, now provides a 26% tax credit for systems installed in 2020-2022 and 22% for systems installed in 2023. Previously, systems installed before 2019 were eligible for a 30% tax credit.

Still, a 26% credit essentially brings the price of a $20,000 solar photovoltaic system down to $14,800. Additional state and local tax incentives could save homeowners even more money. A big bonus: There is no maximum amount that can be claimed.

5. Solar homes work in cloudy states, too: The idea that solar only works in sunny conditions is a myth. According to GAF Energy, new solar cells are more efficient than ever. Today's cells can capture the sun's rays even in low-light situations. Cities like San Francisco, Portland, and Seattle have plenty of foggy or overcast days yet have many "happy solar customers," the firm notes. Some of the fast-growing new markets for solar homes are Boston, Massachusetts, and Newark, New Jersey.

6. Searching online for solar homes listed for sale: Several years ago, the Real Estate Standards Organization (RESO) partnered with the Energy Department's Better Buildings. As a result, RESO led the effort to actively promote adding home energy information into MLSs to aid online home searches. The result is that residential listings feature fields for solar power systems, giving consumers the ability to search solely for solar homes listed for sale in a growing number of markets.

To learn more about solar homes, check out the resources available from the Department of Energy or see the Solar Energy Industry Association (SEIA) map that shows solar data, state by state here.

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Tricia Stamper is Director of Technology at Florida Realtors®, which owns and operates Tech Helpline and Form Simplicity.