Do Solar Panels Increase Property Value in the UK?

Written-by

Janet Richardson

Reviewed-by

Richard Burdett-Gardiner

Updated on

Sep 29, 2024

Do Solar Panels Increase Property Value in the UK?

Solar systems continue to increase in popularity as more and more people want to lead a greener lifestyle and cut their energy bills. Installing a solar panel system helps reduce your carbon footprint and stops you from being completely reliant on the National Grid. With gas and electricity prices rising steeply and solar panels becoming cheaper. installing a solar panel system is becoming an even more attractive proposition. 

Undoubtedly residential solar panels will be attractive to some buyers. Research suggests that solar panels won’t affect your ability to sell your property and may well help you sell it. Often home buyers will take into consideration properties that are already set up with solar so that they can save money on their energy bills straightaway. Not only will the solar panel system save them money on their bills, but they will also save by not having to install the system themselves.

Multiple studies have now been conducted that show solar panels add a considerable amount to your home’s value. However, properties will benefit more in some locations than others. 

A recent study carried out in 2023 by home improvement experts BOXT found that solar panels could increase the value of a home by 14%. Interestingly, the value added to a property in the South-west of England was on the lower end compared to the Midlands on the higher end. 

Another study by real estate company Solar Energy UK in 2021 also showed that solar panels can increase a home’s value. This study found that solar panels could raise a home’s value by 0.9 – 2% on average. 

In 2020 a study carried out by EffectiveHome which specialises in solar panels found that sale prices for homes with solar systems increased by approximately 14%. The study highlighted the fact that homes in sunnier areas benefitted more from solar panels which also made it easier to persuade buyers to pay a higher price. This study found that the average home value increased by £32,459 across the UK if the home had a solar panel system. However, some locations had an even higher average in raising home values. In London, homeowners may see their property value increase by £90,000, and in Bristol solar panels can add up to £45,142 to their home value. Even homeowners in Edinburgh, Scotland might expect an increase of over £40,000 to their home’s value with the addition of solar panels. 

Can Solar Panels Decrease the Value of Your Home?

Sometimes solar panels can decrease the value of your home. It very much depends on what the homebuyer is looking for. The condition your home is in particularly the roof and the buyer’s plans for the property also play a part in the sales process. Here are some of the ways a solar system could devalue your home:

Unattractive appearance
In some locations, solar panels may be considered an eyesore. Some solar panel systems simply aren’t as attractive as others. 

Roof complications
If the potential buyer is thinking about redoing the roof or adding an extension solar panels can make the whole process much more complicated and expensive. 

Maintenance
Solar panels should be regularly maintained to keep them working at their best. Maintenance can include cleaning, repairs, and more. There may be some homebuyers who don’t want the bother of solar panel maintenance. 

Mortgage issues 
Some mortgage lenders may be reluctant to lend money on a property with leased solar panels, as the homeowner does not own the roof. We will look at this in more detail in the next section.

Age of the solar power system
Older solar panel systems may not be as efficient as newer ones.

What to Consider When Buying a House With Solar Panels

Who owns the solar panels on the property?
Even though the solar panels may be on the roof of the house you are buying it doesn’t necessarily mean that you will legally own the solar panels. Only if the solar panels were bought outright will you legally own them. In some cases, the solar panel system has been purchased on credit or through a lease. 

If you buy a house with leased solar panels, under rent-a-roof schemes, you will be bound by a lease. Maintenance cost obligations may be included for which you will be liable. So, when you are preparing for the cost of buying a house it would be sensible to factor this into your budget. 

Can you get a mortgage?
If you are applying for a mortgage on a house with solar panels you will need to know how the solar panels were obtained. You won’t have a problem with the mortgage lenders if the solar panels are owned outright. The solar panels should also be covered by warranties and guarantees, and the current owner of the property should have these. The seller should provide you with all the paperwork you need relating to the solar panels including the solar panel lease and these may be requested by your conveyancer. If additional checks are required, this can cause delays in the conveyancing process. Compare solicitors in your area to ensure you employ a solicitor who is reliable and trusted. Once you have all the relevant paperwork all you will need to do is get insurance to cover the solar panels. 

Solar panels are often covered by your building insurance because they are considered permanent fixtures of the property. However, it's best to check this is the case with your insurance company. 

If, however, the solar panels on the home you wish to purchase are leased and/or were installed as part of a rent-a-roof scheme you may have problems getting a mortgage. If the fitted solar panels don’t meet the recommended standards this can hold up your mortgage application. In fact, the lender could refuse to give you a mortgage at all if the property were judged to be a risky investment as a result of installing the solar panels. The installation should be conducted by a company whose legal paperwork was drafted according to the Council of Mortgage Lenders (CML) guidelines and certified by the Microgeneration Certification Scheme (MCS). Mortgage lenders may also be reluctant to approve a mortgage if certain access rights have been granted to the lessor (the company that leased the solar panels) due to the lease. 

Make sure you obtain all the paperwork related to the solar panels
Most importantly, you need to get the warranty information for all the different parts of the solar panel installation from the previous homeowner. Most solar panels have a warranty of up to 25-30 years. You need to know how much of the warranty remains and exactly what it covers. A lot of solar panel installations come equipped with monitoring technology which requires log-in details. You should be able to get these from either the seller or the company that installed the solar panels. 

Organise a property survey
It is essential to have a thorough building survey conducted on the property you are thinking of buying. It’s possible that the solar panels could be concealing issues with the roof or home making this an important step. 
Guarantees and Warranties for Solar Panel Systems

Solar panel systems generally come with a number of guarantees and warranties in the UK including the following:

Product Warranty
This is an important warranty to obtain as it covers equipment defects, such as faulty materials or workmanship, and normally lasts for 10 – 12 years. 

Power warranty
Equally important is the warranty that guarantees the expected output of your solar panels over a period of time such as 5, 10, or 20 years. Usually, this warranty will guarantee that the panels will produce at least 90% of their original power output at 10 years, and at least 80% at 25 years. 

Labour warranty
Some manufacturers will include labour costs in their warranties but not all. This warranty can cover the cost of labour to repair or replace faulty panels. 

Solar Battery warranty
Solar batteries in the UK usually have a 5- or 10-year product warranty. However, some batteries may have a 12- or 15-year warranty. 

Solar batteries can last between 15 and 30 years, but their capacity may decrease over time. They also have a certain number of cycles, which is the number of times the battery goes from fully charged to empty and back again. Some batteries can go through 4,000 cycles, while others can go up to 10,000. 

Inverter warranty
Inverters are usually covered for 5–10 years. 

MCS certification
This certification proves that the solar panel system was designed, installed, and commissioned to the highest standard. 

In most cases, solar panel warranties are transferable if you decide to sell your home.