Selling Your Home with Solar Panels
Investing in solar panels is becoming more and more popular for homeowners. With this new trend of sustainability, comes the inevitable buying and selling of homes with their own solar system. In fact, homes with solar panel systems sell for 4.1% more than those without. While it may seem complicated, transferring ownership of solar panels doesn’t have to be. With proper knowledge and education on the subject, selling a home with solar panels will be a seamless experience.
Installing solar panels to your home comes with a variety of benefits in the realms of sustainability, economics, health, emergency preparedness, safety, and grid independence. Of all these, perhaps the most notable in selling a home is the economic advantage.
Studies have found that buyers, on average, will spend $15,000 more on homes with already installed solar panel systems. On top of selling for more, studies also show that your home may sell quicker than most with this sustainable amenity. As the push for increased sustainability continues and the costs of energy increase, more and more people are looking toward solar panels as a home add-on.
For some, the benefits of solar panels go without saying, but others may need more of a push. As a seller of a home with solar panels, it is important to inform potential buyers on the benefits that they can offer. Especially if the solar panel ownership comes with some extra costs for the buyer, economic benefits associated with solar panels could be the difference between sale or no sale. Some of the top selling points include:
There are a few basic elements to consider when selling a home with solar panels. Because of the notable up front investment that comes with purchasing a solar system, it is important that all wrinkles are ironed out for the next owner. In order to keep up with the solar maintenance, the new owners will likely want to know the manufacturer, if they are still in business, the specs of installation, the warranty type, e.g. complete warranty, wear and tear warrant, etc., and the length of said warranty.
Aside from the basic information on the solar panel system and its manufacturer, there are a series of other considerations to make depending on your situation, specifically in regards to how it was purchased.
As a homeowner it is important to be prepared when looking to sell your home with solar panels. While it may seem tedious, getting all the necessary documents and information in order before transferring ownership will make the process much easier in the long run.
Gather all the information from your solar panel purchase. This includes any documents, papers, and marketing materials from your manufacturer. Not only do you want information that outlines your purchasing agreement, but having materials outline the reputability of your manufacturer goes a long way.
Put together a maintenance log that outlines what type of maintenance has been done on the solar panel system, all the dates from the maintenance appointments, and any notes that came out of those appointments. Buyers will feel more comfortable taking on solar panel ownership if the previous owner was diligent in maintaining well kept solar panels and can prove it with a maintenance history.
While the easiest course of action in selling a home with solar panels is when the entirety of the cost is paid off, this certainly isn’t the case for everyone. Large investments like solar panels often are purchased using some sort of loan or a leasing system. When it comes to selling before the loan is paid off or when there is an outstanding lease, there are a few extra logistics to consider.
If the solar panel system in your home was acquired through a third party lease, the easiest option is to transfer the lease to the next owner. Educating the new potential owners on the benefits of solar panels and the savings associated with them can make the selling process much easier.
It is important for any seller to be knowledgeable on the stipulations of the lease. This includes the scope of responsibilities held by the homeowner versus the leasing third party. If all issues and repairs are covered through a warranty by the leasing party, that is often an easier sell to the new owners. Most new home owners don’t necessarily want to shell out a lot of extra income into a solar panel system that they didn’t purchase in the first place.
If your solar panel system was purchased using a loan, the ownership transfer process will look a bit different from leasing to loan and loan type to loan type. If a secured loan was used, the remainder of the loan should be settled prior to transferring ownership. If an unsecured loan was used, you may be able to sell the home without settling the remaining costs, but you will likely need to continue paying the rest of the balance even after the ownership is transferred.
PPAs are often used when going solar. According to the Solar Energy Industries Association, a PPA is defined as “financial agreement where a developer arranges for the design, permitting, financing and installation of a solar energy system on a customer’s property at little to no cost”. Understanding the requirements and restrictions around your PPA is important when looking to transfer ownership. Some PPAs have time limits as buyout provisions. This can include waiting a certain number of years before ownership can be gained.
Everyone’s situation when it comes to solar panel ownership is different. Differences can stem from the way the system was purchased, having a loan versus a lease, and other stipulations attached to the ownership agreement. This being said, there is some standardization to the ownership transfer process. For the most part, the ownership transfer process looks like this:
1) To begin the ownership transfer project, the first step is acquiring the necessary paperwork. For the most part, this paperwork looks like an ownership transfer form. But, depending on your manufacturer and purchase agreement, the papers may look different.
2) Once the proper paperwork is gathered and the future homeowners are on board with taking on the solar panel ownership, both parties must fill out and sign the documents.
3) After the forms are signed and approved, any leases or loans are transferred to the new owners.
4) The new owners will likely have to submit a credit application to the solar company. This is to provide proof of having the financial ability to continue with any payments or upkeep costs.
5) The last step in the process is getting approval from the utility company. This is generally quick and in place to ensure that the new payment accounts are properly transferred.
Unfortunately, like all things, selling a home with solar panels doesn’t come without a few drawbacks. The most common and likely most prominent drawback with selling a home with solar panels is if the new homeowner has to take on major additional costs. While most buyers are comfortable with slight additional maintenance costs, anything more could dissuade them from purchasing the home. The most common area for extra costs is if the warranty doesn’t transfer over or if the transfer comes with a price tag. Solar panel repair, especially without a warranty, can be extremely expensive.
The state of a solar panel system will be under scrutiny when selling a home. Maintaining proper solar upkeep is important in general, but especially important when looking to sell. Buyers who are considering homes with solar panels will be particularly interested in the current state of a system and will likely not want to purchase your home if the panels are broken or have any outstanding repairs that need to take place.
Solar panels are a major investment, but their benefits are unbeatable. When buying solar panels for your home it is important to choose a solar panel partner that has your best interests in mind. This partnership is priceless when you choose to sell your home. Responsible and professional solar partners, like Citadel Roofing and Solar, can make the ownership transfer much easier for all parties involved.
Citadel Roofing and Solar is a trusted solar panel partner throughout the state of California. Their team of professional industry experts are always available to answer questions, go over maintenance plans, and ensure that your solar panel provides only positive outcomes. Call us today to get started on your solar panel journey.
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Vacaville, CA 95688
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Sacramento, CA 95834
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Santa Clarita, CA 91350
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