Dorian Bishopp blames the solar panels on his roof for costing him almost 10 percent off the value of the home he sold in March. That’s because instead of owning them he leased the panels from SunPower Corp. requiring the new owner of the house to assume a contract with almost 19 years remaining. Although leasing some products is a good idea, in this case, it’s better to buy. If you want to learn more about the benefits of solar panels, you can Click Here.
He had to shave the asking price for the house in Maricopa, Arizona, to draw in buyers unfamiliar with the financing arrangement. Leasing is driving a boom in solar sales because most require no money upfront for systems that cost thousands of dollars. Homeowners can get individual parts from a solar system parts supplier, without having to spend a fortune on a whole solar energy system. That’s made solar affordable for more people, helping spur a 38 percent jump in U.S. residential installations in the past year. Since the business model only gained acceptance in the past two years, the details embedded in the fine print of the deals are only starting to emerge. For people who own rooftop power systems, solar adds value to the home — about $25,000 for the average installation in California. But, leased systems are another story because they’re personal property and the lease must be assumed by the buyer.
Solar leases were introduced in 2008 and became popular around 2012. Today, almost three-quarters of residential systems being installed are financed through leases. “Some buyers just won’t be on board” with assuming a solar lease, said Nick Culver, a solar analyst at Bloomberg New Energy Finance in New York. “Even if you save money every month, you limit yourself to a certain subset of buyers.”
Scott Vineberg, a SolarCity customer, received multiple offers for the Scottsdale, Arizona, home he sold in January. The lease made the deal more complicated because the buyers were reluctant to take over the contract and asked him to pay off the balance in advance, about 10 years of payments. “I don’t think they understood it,” said Vineberg. He refused to pay off the lease, and instead provided years of documentation to verify the monthly energy savings. After the sale closed, the buyers opted to pay off the lease, and Vineberg installed another SolarCity system at his new home. This shows that it may be best to actually buy solar panels for a home, so if sold, the new owners will not need to pay rent for them. If the owner wants solar panels but cannot afford them, it would be best to look for a solar loan to help pay it.
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