Solar for Your House
Adding a solar array to your home can be an excellent investment, providing energy savings and boosting property value. If you’re considering buying a house with an existing solar system, expect to pay approximately $15,000 more than a similar house without one. This figure can vary based on factors such as whether the system includes a battery, the system’s age, and its expected energy generation. Appraisers often rely on specialized databases to determine these values.
What to Consider if You Plan to Add a Solar (PV) System
The Cost
Installing a solar system typically costs $15,000 or more, depending on your location. In some areas, the price can approach $30,000. Alternatively, you can explore leased solar programs, which offer lower up-front costs.
Complications with Rented Systems for Home Buyers
Leased solar systems are increasingly common. In these arrangements, homeowners rent the system from the installation company rather than owning it outright. While this setup reduces installation costs, it can create challenges when selling or buying a home.
When purchasing a home with a leased solar system, the monthly rental fee is added to the cost of your housing as calculated by lenders. For example, if the lease is $200 per month, it impacts your debt-to-income ratio, potentially reducing the amount you can borrow. In some cases, this added expense could disqualify a buyer from securing a mortgage, even though the solar system reduces utility costs.
To avoid complications, review the solar lease agreement thoroughly. Some companies may allow the seller to pay off the lease at closing, converting the system to full ownership. Alternatively, if the lease is nearing its end, the seller may transfer ownership of the system as part of the sale. Both solutions can ease the financing process for buyers.
Complications with Condos
Installing solar panels in a condominium setting presents unique challenges. Roof space is typically shared among condo owners, requiring agreement from the condo association to proceed with an installation. Additionally, limited roof space may prevent all residents from accessing solar power. If you’re set on going solar, ensure that the condo association’s rules align with your goals before signing a contract.
Solar energy is an appealing option for homeowners looking to save on energy costs and reduce their environmental footprint. Whether you’re purchasing a home with an existing system or planning to install your own, it’s essential to understand the financial and logistical considerations involved. By doing your homework and addressing potential challenges early, you can harness the power of the sun to benefit both your wallet and the planet.