In 2008, Red Hot Chili Peppers bassist Flea paid $3.85 million for a 1915 Los Angeles house and renovated it with rooftop solar; Jack Black later bought it for $5.965 million

This is the story of a Red Hot Chili Peppers bassist who renovated a crumbling old house in Los Angeles. In 2008, Michael "Flea" Balzary purchased a 1915 house in the Los Feliz neighborhood of Los Angeles for $3.85 million, which has since been renovated in a Topanga Canyon, hippie-chic style, down to every detail, including rooftop solar panels. According to a 2011 Los Angeles Times article, actor Jack Black purchased the property in 2011 for $5.965 millio; by then the house itself had grown to seven bedrooms, three bathrooms, and 6,500 square feet. That's an increase of roughly 55% over three years for a house that was 93 years old when Flea's hands first reached it.

This can easily be interpreted as yet another only-in-LA celebrity flip. There is another, less glamorous explanation for the tendency toward higher home prices that's hiding on that roof: solar panels have a measurable impact on home prices, and for more than a decade, researchers have been able to prove it. A report by one of the US Department of Energy's own research labs, the Lawrence Berkeley National Laboratory, found that buyers of homes with a medium-sized solar installation have been paying a premium of approximately $15,000, or about $4 per watt installed, over similar homes without solar installed, in eight states and spanning over 10 years of sales data.

The house was old, weird, and hippie-ish, and still sold for millions more


Flea's place was not some shiny new-construction flex. It was a century-old fixer, if not a rather odd one, and its kitchen had an extreme hippie vibe to it. All that did not get in the way of it more than doubling in three years. Part of that is just LA real estate is LA real estate: Los Feliz is one of the more sought-after, celebrity-dense pockets of the city, and homes there already command a premium regardless of what's on the roof. The pool and the motor court were among the specific upgrades listed in coverage of the sale, but so was the solar. That solar premium is real, but it's a small slice of a much bigger number, the Berkeley Lab figure points to roughly $15,000 of added value from the panels themselves, nowhere near the full $2.1 million gap between Flea's purchase price and Jack Black's; the rest of that gap is better explained by the renovation as a whole and by three years of appreciation in an already-expensive neighborhood. Still, the direction of the solar effect is consistent with real estate data since then.

Homes with solar energy systems on their roof seem to have increased in value by 4.1%, on average, compared to similar homes without solar energy systems, which translates to an additional $9,274 for the median home in the United States, and even more for homes in markets such as New York and San Francisco, according to a Zillow Research publication. This isn't the case with just the buyers, either. The National Association of Realtors notes that a significant portion of real estate agents indicated that solar panels were available as an option in their markets, and a substantial percentage noted that solar made a positive impact on the value perception of a buyer when it was considered a part of a home. This is no longer a niche green fantasy; it's becoming a reality in price and pitch in the real world.

The somewhat quirky thing nobody wants to state publicly

The challenge for many buyers is that adding solar panels to a fixer-upper is not as simple as it is for a rock star with decades of RHCP royalties. Paying up front for the solar, working out all the panel installation costs, or figuring out if the panels are owned or leased (in this case, leased doesn't give you the same resale value, much as it doesn't cover the high up-front cost), all of that isn't as straightforward as Flea's story makes it sound. A leased system sidesteps the high up-front cost of buying panels outright, since the leasing company covers that, but it also typically doesn't carry the same resale-value boost as an owned system, because the home's next buyer would just be inheriting someone else's lease payments rather than a paid-off asset. The facts are that solar is cost-effective. It is not cheap, nor is it easy to get there, and there's real distance between "proven to add value" and "accessible to the average first-time buyer," and that gap is one worth being a bit skeptical about.

The takeaway

The house where Flea once lived is a tidbit of only-in-LA trivia. Remove the rock-star branding and the high cost, and it may be more or less of a small-scale, real-world example of something that researchers have been studying ever since: solar panels are assets. Whether that asset is much more easily accessible to all, of course, is a very different question.