There is strong evidence that solar panel installation increases the value of a home. Also, they sell much faster than non-solar residential properties. Several studies have reported that solar-powered properties are valued and sold at greater values than non-solar power-equipped buildings in the same area. Solar panel installation increases the home value by about 3-4% on average. Buying and selling a house with solar panels is always worthwhile for a buyer and seller.
Since solar has a huge impact on property value, there are multiple factors that you must consider when buying or selling a solar-powered home. Here is how you can make purchasing and selling a house with existing solar panels easier.
Ask these questions before purchasing a house with solar panels
Homeowners should invest in solar energy to save big amounts on their electricity bills. Thus, you must clear all your doubts about system financing and other associated things by asking the following important questions from a seller.
- Who owns solar panels?
Buying a home doesn’t mean you are also purchasing the installed solar panels. In some situations, there is a lease arrangement where the homeowner pays a fee to a company that owns the panels for using third-party-owned solar panels.
Ask whether you would need to take over a lease or the homeowner owned the solar panels. If there is a lease, thoroughly check the terms and conditions to understand the costs and other options to get the lease.
- What is the roof condition and age?
The roof condition has a direct impact on the solar system’s performance. If the roof is not strong enough or in a bad condition, it needs to be repaired and solar systems need to be removed. The old age or poor shape of the roof can lead to damage or improper function of the solar panels. This can also increase the duration, cost, and complexity of any repair, maintenance, and replacement.
- Which company installed the solar systems?
The lifespan and operating capacity of solar panels are highly influenced by who installed them and how. Be sure the solar systems are installed by a licensed and reliable rooftop solar installation company after doing a proper site inspection and are tested properly for any damage or destruction.
Some homeowners perform DIY installation using self-installation kits available in the market. Solar panels installed by the non-professional installer or the homeowner may not come under warranty coverage and have a risk of any component failure or improper functioning.
- How are the solar panels financed?
If the solar panels were bought completely by the homeowner, you will buy solar systems along with the home. However, if they were purchased via a loan, you must pay the balance of the loan when purchasing the house. This will increase the home’s purchasing cost. As mentioned above, if solar panels are financed through PPA or lease, you will not buy the system along with the home, instead, you will have to pay a third party to use the solar energy. So, clear the financing options.
- Ask for the electricity bills of the seller.
Checking the electricity bills for the past few months will help you understand the amount you could save on your utility bills with solar panels in the home. This will assist you in analyzing whether installed solar panels will meet your power consumption requirements or if you will require installing more solar panels. This will also allow you to look for solar incentives available in the local community like net metering, solar subsidies, etc.
Consider these things when selling a solar-equipped home
Although selling a home is not a tough job as buyers are showing more interest in solar-powered houses, there are some tips that can make your home selling faster and easier.
- Add solar system installation to features list
Before purchasing any house, most buyers pay attention to the list of features available in the property. So, it is important to mention the inclusion of solar panels in the listing of your home. It could gain the attention of more potential buyers.
Add the number of solar panels, the name of the solar panel installation company, and the solar power production capacity. Also, describe the economic, environmental, and other benefits homebuyers can expect by producing green and clean electricity at their home without depending on the grid.
As a seller, tell potential buyers the cost savings you are presently getting on your electricity bill with installed solar panels. Also, add the point of reduced carbon footprint. You can also inform buyers about other earnings you’re having with solar systems through net metering, gross metering, incentives, etc.
- Collect relevant documentation
Keep all the relevant documents along with you to show buyers how long your solar systems will last, how they are performing, what the associated warranties available are, materials used, and other important facts. You can also show your current electric bills to let buyers know how much cost savings they can enjoy with solar panels. This will not only allow home buyers to make informed decisions but also create a great image of you as a seller.
- Describe financing clearly
If you buy solar panels outright, you are the owner of the panels. Appraisers can consider it as an aspect of your house’s value. Also, if you bought the solar panels via a loan and paid it off fully, you own the solar panels and it can be included in the appraisal of your property.
However, if you bought solar panels via a loan and you have not paid off the loan completely, then the buyer will have to pay the remaining amount of the loan when they shift in the purchased home. If you want to take off solar panels and install them at your new home, you can continue paying the remainder. If you wish to leave the solar panels, you can adjust the solar panels’ loan amount when calculating the home’s selling cost.
If you have leased your solar panels with a traditional PPA or leasing arrangement, you can’t consider your solar panels into the home’s appraised value as you are not the owner of it and paying a third party to use the solar power. So, let the buyer carefully and completely review the contract and associated financing options.
Conclusion
So, these are the basic tips to follow when buying or selling a house with solar systems. Not just for home but you can work on these tips when purchasing or selling an office or workspace with a solar system for commercial building installation.
Most of us know that solar systems increase the value of a property. But, some people find purchasing or selling a solar-equipped property challenging. If you keep the abovementioned tips in mind, you can seamlessly and confidently sell or purchase a home or commercial property with solar systems. One thing is sure a solar-equipped property is a win for a buyer and seller.