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Will solar panels increase your home’s value in 2024?

They save on electricity costs and reduce dependence on Eskom, but do solar panels increase home value? We discuss.

Solar Panels Home Value

Article summary

  • Solar panels can increase home value in the long-term, as renewable energy becomes more prevalent.
  • The government is no longer providing tax rebates for solar panel installation.
  • However, banks are still doing their part by funding solar panel installation in addition to home purchases.

Eco-conscious homeowners keen to go green are likely to consider solar panels. They have many benefits, such as saving on electricity costs and reducing the impact of Eskom loadshedding.

In addition to that, there are ways in which solar panel installation bumps up the value of a property. We discuss tax incentives and solar panel benefits.

Solar installation tax breaks are no more

The 2023 budget speech announced a 25% tax rebate on the cost of installing solar panels.

Unfortunately, the 2024 budget speech included no plans to extend the tax rebate for solar panel installation.

Is solar panel installation still worth it?

Despite the loss of government incentives, there are still many benefits to solar panel installation.

Several studies show that solar panels increase the value of the property by 3 to 4%.

However, this is dependent on a number of factors:

  • The size of the installation. This will be determined by how many solar panels your roof can hold, which will in turn affect how much you save on electricity.
  • The quality of the panels, which will affect their lifespan.
  • The warranty on the solar panels; they need to last a long time.
  • The location of the property. This affects how much sunlight it is likely to receive.

Value in work-from-home lifestyle

Many South Africans have become accustomed to the work-from-home lifestyle that became predominant during the pandemic.

This has resulted in a higher demand for properties in remote, scenic areas.

It also leads to demand for properties with an uninterrupted power supply so work from home isn’t interrupted. So solar panel installation will certainly increase the demand for a property.

Get a loan from your bank

Although the government no longer provides financial assistance for the installation of solar panels, banks are doing their part by funding solar panel installation in addition to a home purchase.

How much the bank will pay and when they will pay it varies between banks.

  • Percentage of property value: Some banks provide a percentage of the property value as a loan for solar installation, with a minimum and maximum loan amount.
  • Loan-to-value ratio: The LTV ratio compares the amount of the mortgage to the appraised value of the property. For some banks, this value determines how much will be granted for solar panel installation.
  • Solar quote required: Some banks will require a solar quote to be presented while others won’t.
  • Access to funds: Banks vary as to when they will make the funds for the solar installation available.

A rundown of the different banks and what they offer

First National Bank RMB Private Bank Standard Bank Nedbank ABSA
Loan limited to 15% of property value. Minimum loan of R50k Loan limited to 15% of property value. Minimum loan of R50k 70% of funds can be paid to the solar installer An increase to your home loan instalments that will be offset by the reduction in electricity costs An increase to your home loan instalments that will be offset by the reduction in electricity costs
For LTV loans > 100%, maximum loan is R200k For LTV loans > 100%, maximum loan is R200k
Solar quote not required, only estimated cost Solar quote not required, only estimated cost Solar quote required Solar quote required Solar quote required
Funds can be accessed on bond registration Funds can be accessed on bond registration Funds provided at bond registration Funds will be paid once the solar installation is complete Funds will be paid once the solar installation is complete

Get the best deal on your home loan

Bank loans make solar panel installation a viable option for boosting the value of a property.

Applying to multiple banks will give you the best chance of getting a good deal on your home loan, and consequently your solar panel installation.

Apply with ooba Home Loans and we will submit your application to multiple banks so you can compare deals and choose the most favourable home loan package.

Get a free home loan comparison.

Multiple quotes from the big banks to compare.

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