Solar panel systems for homes have become understandably quite popular these days. Selling a home with solar panels can be an added hassle, though, since there are some extra steps that go along with it. Homes with solar need to be properly marketed since they are drivers for a better price. Make sure to get the maximum value when selling a home with solar.
Get A Free Mortgage QuoteHow to Price a Home with Solar?
One would imagine that having solar panels would raise the house's market value, given their popularity. This may not always be the case; in fact, it's uncommon for a seller to receive a dollar-for-dollar rise in price if they want one because of the installation of solar panels.
The pricing of similar properties and the state of the local housing market will have a major role. Installing solar panels on a house typically costs between $20,000 and $30,000. It is not practical to raise a house's asking price by that much in order to recover the costs. Even with the cost reductions from using solar power, the house will probably be too expensive for the market.
Leased and Owned Solar Panels: What’s the Difference?
So long as the seller bought the panels and isn't leasing them, part of that additional cost may be reflected in the asking price. However, because they are expensive, many homes choose to lease solar panels instead of purchasing them entirely.
A home's worth won't rise at all if solar panels are leased. The vendor could even have to lower the asking price. This is due to the fact that the lease, which may last up to 15 years, depending on the specifics of the agreement, must be assumed by the new owner.
Leasing solar panels for a house implies paying an additional monthly payment in addition to the mortgage. Regardless of how much they would save on the electricity bill, it is doubtful that a buyer will be ready to pay more for the property in those conditions.
If the seller has the funds, they may choose to buy the lease. Buyers could find it more tempting, and the sellers may be able to demand a little bit more if they own the solar panels.
Strategies for Selling a Home with Solar
There are some ways that you can get a great price when selling a home with solar panels. Here are a few measures you can take.
1. Listings Should Mention Solar Systems
While viewing houses, most buyers search for energy-efficient features. Thus, it's critical to mention your solar system with your house. Highlighting the solar panels in a property listing may assist prospective buyers grasp the system's value and draw more people to open houses. Along with system size and energy output, you should emphasize the advantages homeowners will have from producing their own electricity. Present how you can lower your carbon impact, gain benefits through incentives, and save money on electricity costs all at the same time.
2. Sorting Out Financing
Whoever owns the solar system affects how much the selling price of your house increases when you install solar panels. The solar system becomes your property when you buy it outright, and it is called "real property." This implies that appraisers might include it in the appraisal of your house. In a similar vein, if you took out a loan to buy your system and have since paid it back, you are the owner, and it may be taken into account when valuing your house.
If you purchased your solar system through a loan, and the loan hasn’t been paid off, then you’re responsible for paying the remainder of the loan when you move. If you want to leave your system, then you can factor in the cost of the solar loan payments when calculating the selling price for your property. Alternatively, you’re able to take your solar system with you and install it at your new house.
Moreover, you will need to choose whether to transfer future incentives to the new homeowner or keep generating money through the current Solar Massachusetts Renewable Target (SMART) Program or the SREC Program if you bought your system directly or through a loan and live in a region serviced by National Grid, Eversource, or Unitil.
Lower power bills continue to benefit the future homeowner even if you decide to maintain incentives in your name. But, giving the buyer access to the SMART Program raises the house's resale value, so you should think about it. If you choose this course of action, SRECTrade, the organization responsible for managing solar renewable energy credits, can assist you in transferring ownership of incentives.
Finally, since you do not own your system, you cannot include it in the appraised value of your property if you rented it through a typical leasing program or a Power Purchase Agreement (PPA). Instead, the power generated by the system is paid for by a third party.
If you're buying or selling a house with a leased or PPA-tied system, carefully check the contract as the conditions may differ based on the solar provider or manufacturer. The new homeowner can choose to stay on the solar lease, but if they choose not to, the original homeowner is still fully responsible for the lease.
3.Important Documentation
It's beneficial to compile pertinent documents to present to prospective buyers of solar-powered homes since they will want to understand how the panels will function over time. You should allow your purchasers to inspect any documentation pertaining to your system and the materials utilized, as selecting the appropriate panels might affect how long your solar panels survive.
Similarly, a customer's investment might be made or lost by a quality warranty. Therefore, you should let your buyer know about it. Finally, so that prospective purchasers understand how much money the solar energy system saves you, you should let them go over your power bills. It's important to emphasize your savings because this is what significantly raises the worth of your house.
Get A Free Mortgage Quote4.Realtors Can Help
Depending on where you reside, both the solar industry and real estate rules are always changing. Working with an agent who is knowledgeable about the local solar and real estate markets is therefore essential. The correct real estate agent will guide you through the whole sales process, including the extra requirements needed to install a solar system.
5.Solar System Appraisals
Get an accurate assessment that represents the value your solar system provides to your property before marketing your solar-powered home. Zillow research indicated that solar panels contributed up to 4.1% of property values on average, which is a big amount. This will establish the asking price and provide reassurance to potential buyers that the system's worth is appropriately included in the total value of the property.
If not, potential purchasers would wonder how long the panels will last and whether they will have to remove the array, which might make the property less appealing to them. The value your solar panels offer to your property will depend on their efficiency and remaining lifespan.
Conclusion
When selling a home with solar, you need to make sure that you are getting the best deal from a buyer that validates the investment you have made. The strategies outlined above can help you find the right buyer with the right price!