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FHA and Fannie Mae agree: A solar panel system adds value to your home (if you own the system)

Looking for Fannie Mae solar panel loans? Check out our article on the Fannie Mae Homestyle Energy Program.

Solar loans and solar financing provided by Fannie Mae have drawn major attention from homeowners as one of the new premier ways to save big withs solar panels. And one question that EnergySage receives regularly from our customers is: “Will solar panels increase the value of my property?” It is clear that the answer is already a resounding ‘yes’, and the evidence only continues to mount. We have compiled a list of studies that highlight this point, and recently wrote about Lawrence Berkeley Laboratory’s recent study showing that solar panels increase home values significantly across the US. These studies mainly look at cases where the homeowner is also the owner of the solar panel system. Interested in solar panels for your home? Click to here to get a quote We know for certain that owning your solar system will save you more money on your electricity bills in the long run than installing your system under a solar lease or power purchase agreement (PPA). This is the primary reason that homes with solar panels sell for more: they offer a definite financial benefit to the future owner.“Will a leased solar panel system add value to my home?” is another question we receive on a regular basis, but it is less clear whether value is added to your home if you’ve financed your system with a solar lease/PPA. Two recent documents which EnergySage has reviewed shed further light on the matter. KEY TAKEAWAYS

  • If you own a home with a solar system, the FHA requires (to your benefit) that its value be assessed and added to the total appraisal value of your home when you want to sell it. However, if you do not own your panels, whatever value that they may add cannot be included for an FHA assessment

  • Like the FHA, Fannie Mae has indicated that the value of a solar energy system may be included in an assessment of your home – but only if you (the homeowner) are also the owner of the system. If you lease your solar energy system, on the other hand, the system’s value (if any) may not be incorporated into the assessment, and there are a number of additional requirements that must be met before Fannie Mae will approve a mortgage for a potential buyer.

  • Will a solar system add value to your home if you finance it with a solar lease or power purchase agreement (PPA)? The FHA and Fannie Mae have little to say about whether financed systems are an asset or a liability. The picture should become clearer as more solar homes are sold and more data becomes available.

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