Solar systems can increase a home’s sale price by around £1,800, according to a new report from trade body Solar Energy UK that calls on mortage providers to better account for the financial benefits associated with solar installations.
The Value of Solar Property report, published today, explores the financial value of installing solar energy systems and projects that the financial benefits arising from solar installations are likely to increase as the UK scales up the use of electric heating in homes and switches to electric vehicles (EVs).
The report found that installing a solar system could slash average energy bills in a typical UK home by a third and save £330 in annual running costs over its lifespan, while the £1,800 increase in market value covers nearly half the upfront installation cost.
Solar Energy UK said the growing financial benefits from solar systems should increase demand for solar installations on homes. Financial savings are also expected to increase in response to the drastic increase in gas prices in recent weeks.
“The UK stands on the brink of a home energy revolution,” said said Chris Hewett, CEO of Solar Energy UK. “The Value of Solar Property makes clear that there is a powerful investment case for residential solar. Solar Energy UK calls on the property finance and lending industries to recognise this. Bringing new green finance products to the market – and recognising the value of solar homes – will help unlock millions of affordable energy projects for home owners and occupiers around the country.”
Hewett said there was also a compelling message for homeowners from the report. “The findings of the ground-breaking research carried out for this report – including statistical analysis of more than five million property transactions – are clear,” he said. “The return on investment makes upgrading a home with solar power system an easy and simple way to lower a property’s running costs and increase its value, while also, crucially, reducing its environmental impact.”
The report recommends that financial institutions develop consumer finance and green mortgage products that reward investment in solar properties. In a survey the group carried out alongside its report, Solar Energy UK found 46 per cent of homeowners asked would install a solar energy system if there was a consumer finance product that covered the upfront payments of installation.
The survey also found that solar panels are the third biggest home improvement priority for homeowners, following kitchen or bathroom upgrades and windows improvements.
Solar Energy UK called on the government to create a level tax playing field for solar, encourage the development of new consumer financing initiatives, and develop green retrofit programmes help unlock to considerable pent up demand for solar installations that can simultaneously create green jobs, reduce energy bills, enhance energy security, and curb emissions.
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