As solar energy becomes increasingly prevalent, particularly in regions with abundant sunlight like California, understanding the solar contracts has become essential. For home seller with solar panels or buying a property that includes them, it’s important to know ho these systems impact property value, utility savings, and the overall sales process.
Recently Linda Peltz realtor held an insightful talks with Scott Crumb from Powur Solar. They deep dive into the types of solar contracts you may encounter, their implications for real estate transactions, and the benefits.
Tune in to video below for more details
Types of Solar Contracts: Owned vs. Leased Systems
One of the first things to determine when dealing with a property that has solar panels is the type of contract in place. The primary categories include owned systems, Power Purchase Agreements (PPA), and leased systems. Each of these arrangements has unique implications for both the seller and the buyer.
Owned Solar Systems
When a homeowner owns their solar system outright, it typically increases the property value. In California, for example, an owned solar system can boost a home’s value by approximately $20,000.
This is due to the direct financial benefits the new owner will receive, such as reduced utility bills. Homeowners should be ready to provide potential buyers with data on these savings, which can significantly influence the sale price and the buyer’s decision.
Leased Systems and Power Purchase Agreements (PPA)
Leased systems and PPAs present a different scenario. With a leased system, the homeowner does not own the solar panels; instead, they pay a monthly fee to the leasing company. Depending on when the system was installed, the buyer might need to qualify for the lease, adding an extra step to the purchasing process.
Newer lease agreements may simply transfer to the buyer without a credit check. Buyers should be informed about any additional costs or qualifications associated with the lease.
PPAs are similar to leases, but rather than paying a fixed monthly fee, the homeowner pays for the power generated by the solar panels. This arrangement often results in lower utility bills, but the terms of the PPA can vary. Understanding these terms is crucial for both sellers and buyers, as they impact ongoing costs and potential savings.
The Impact of Solar on Property Sales
Solar panels can be a significant selling point, especially in regions like California where utility costs are high, and sunlight is plentiful. However, the type of solar contract and the specifics of the system in place can affect the sale in various ways.
Value Enhancement
As mentioned, an owned solar system can increase a property value. Buyers are often willing to pay more for a home with an owned system due to the long-term savings it offers. Conversely, leased systems or PPAs might not increase the sale price as much, but they can still be attractive to buyers who are interested in the immediate energy savings.
Potential Hurdles
When selling a home with a leased system or PPA, it’s essential to communicate clearly with potential buyers about the terms of the agreement. Older lease agreements might require the buyer to qualify, which could complicate the sale.
Additionally, understanding how to add to an existing system without losing favorable terms, such as those under the NEM 2.0 program, can be a selling point. Homes with outdated or inadequate solar systems may require upgrades, which could either be a selling feature or a potential drawback, depending on the buyer’s perspective.
Navigating Solar Contracts with Expert Help
Given the complexities of solar contracts, it’s beneficial for real estate professional and homeowners to work with experts who specialize in solar energy systems. These professionals can help clarify the specifics of different contracts, evaluate the benefits or drawbacks of an existing system, and guide buyers and sellers through the process smoothly.
Powur Solar as Solar System Partner
If you’re a homeowner or a real estate professional in California, partnering with Scott Crumb & Powur Solar for your solar energy needs is a smart decision. With over a decade of experience in the solar industry, Scott has the expertise to guide you through every aspect of solar energy, from understanding the financial benefits to navigating the complexities of solar contracts.
He takes the time to understand your unique situation and future needs, ensuring that you receive a tailored solar solution that maximizes your investment. By choosing Scott Crumb’s services, you’re not just getting a solar system; you’re gaining a trusted advisor committed to helping you make the most informed and beneficial decisions for your property.
Scott Crumb
Powur Solar
559-906-8063
scottcrumb@hotmail.com
FOLLOW US; CLICK FOR YOUR FAVOURITE CHANNEL
https://linktr.ee/RealtorFresnoCA
Call me for further details:
Linda Peltz, eXp Realty | DRE 01997670
559-353-4556
lwpproperty@gmail.com