Selling a House with Solar Panels: Common Questions
Solar energy has been popular for long enough now that there are a ton of homes on the market that are being sold with solar already on them. The panels, as long as they are functional, obviously add value to your home, but can complicate the home sale. If you're one of those people that are attempting to sell a house with solar on it, you probably have many questions, including:
How much value does the solar system add to the home sale?
A recent study conducted by the Lawrence Berkeley National Laboratory found that homebuyers were willing to pay more for solar homes. They also found that homes with the average PV system in their sample size (3.6 kW) sold for around $15,000 across different states. That said, these are averages and the study was done a few years ago so the values swing wildly. The best way to get a true value is to get a professional solar company, like SunPower by Stellar Solar, to do your valuation. They will make sure the panels, and system as a whole, is running properly so that they retain their full value.
2. Will a solar lease effect my home sale?
You may be worried that a leased solar system on your home will scare off potential buyers, or lower your home price, due to incurred costs or complications with the lease. While these worries are founded, you should rest easy knowing that the majority (77 percent) of homes sold with a solar lease had no negative effect on the value of the home due to the lease, according to Research by Lawrence Berkeley National Laboratory. However, the study did find that around 20 percent of buyers were scared off by the lease.
The best way to keep buyers from being scared away by a solar lease is knowing the options for transfer of ownership, and being able to succinctly express them to the home buyer. This obviously requires deep knowledge of the lease and how it will be transferred, so either legal knowledge or solar contract knowledge will be required in order to get the best value out of the transfer. Instead of paying for an expensive lawyer to help you with this, a viable alternative to deciphering a solar lease is to consult with a solar company that knows what to look for. We can also provide this service if you have any questions about your lease.
3. How does selling the house with a solar lease work?
When selling a house with a leased system, you have one of two options.
A. Transfer the lease: As we have discussed, this can be a complicated process, but, given the home buyer passes the credit check and the third-party owners criteria, most of the time leases are transferable. Likely, if the home buyer has been approved for a mortgage, they will be approved for a solar lease.
B. Buy out the lease: Paying the rest of what you owe on your solar lease so that you own the panels makes it more attractive to the home buyer. It also makes it so that you can add the value of the system itself to the price of the home as it will be owned. If you want to move the panels to your new home, and not sell them, this can allow for that as well.
Either way, you go you'll need to decide with the buyer and the third-party what your course of action will be before you even start talking about selling. If your third-party has gone out of business, you'll want to discuss with another solar company what your options are.
4. How does selling a home with financed solar work?
If you purchased your solar panels and they are being financed, then how and when you can sell them is based on how you financed them. If you paid for them with a secured loan, you likely have to pay off the panels before you sell the home as the loan uses your property as collateral.
If you paid for them with an unsecured loan, then you can likely sell your home. If you work out the sale of the home with the value of the panels added, you can likely pay off the loan with the extra money you got from the value of the panels.
5. Does the warranty get transferred to the new owner?
Likely, if your panels are still within their guaranteed useful life, the solar warranty should be transferable to the new homeowners. This is something you would have to call your installing solar company about.
As many solar companies have gone under over the years, many warranties have been voided, and many solar systems have been left with no company to service them. Companies like ours can maintain those systems that have been abandoned by the original installer.
So, the bottom line is that selling your home with solar on it is possible - but complicated. to get the maximum value out of your sale, you need to go through a solar professional who can valuate your system, best interpret your lease or financing contract, and best express the value of the system to the buyer. To go on your own would be unwise, and ultimately cost you money.
So if you're selling your solar home and need help, SunPower by Stellar Solar is here for you. We can interpret your contract, valuate your system, repair it if needed, and guide you through the whole process of the sale. We have the experience with contracts, leases, and realtors to know how to get you the most for your money. Contact us today if you need help selling your solar home.