Solar panels might not help home values

CaliforniaSolarHomePutting solar panels on home roofs is the rage in California with all our sunshine. But it might not help home values if the panels are leased.

The problem is the new owner, in addition to qualifying for the mortgage, also has to qualify for the lease on the panels. Reported the Washington Post:

“Some would-be buyers balk when they learn that they’ll need to qualify on credit to take over your solar lease payments for the next 15 to 17 years. Others say they like the house but won’t sign a contract unless you buy out the remaining lease payment stream — $15,000 or $20,000 or more — because they’re worried that the solar equipment will become obsolete or won’t save as much on electricity bills as advertised.”

“Issues such as these are popping up increasingly in California and other states and are interfering with sales and closings, according to real estate industry experts.”

As with other areas of technology, solar panels are getting better and cheaper every year. So picking up a long-term lease on a rapidly depreciating asset might not be such a great investment.

The Post’s advice:

“Be aware of the potential complexities that can occur when you lease, rather than buy, solar panels. If you opt for a lease, understand your long-term obligations, and talk to your current utility company about the savings claimed. Most important: If you’ve got a leased system and plan to sell, contact the leasing company well in advance to learn about lease transfer and buyout options. That way, you’ll be ready if prospective buyers have problems with your panels.”

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John Seiler

John Seiler

John Seiler has been writing about California for 25 years. That includes 22 years as an editorial writer for the Orange County Register and two years for, where he is managing editor. He attended the University of Michigan and graduated from Hillsdale College. He was a Russian linguist in U.S. Army military intelligence from 1978 to 1982. He was an editor and writer for Phillips Publishing Company from 1983 to 1986. He has written for Policy Review, Chronicles,, Flash Report and numerous other publications. His email: [email protected]

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