4 Tips for Buying and Selling a Solar Home

Sabrina Lopez
May 4, 2021
3 min read

The housing market in Phoenix has been white-hot for a while, thanks in part to historically low-interest rates and the new work-from-home culture brought about by the coronavirus pandemic. Demand shows no signs of slowing, with transactions hindered only by inventories.

This means that more solar homes are changing hands than ever before. When managed correctly, these transactions offer ample upside for buyers and sellers. Many solar-equipped Arizona homes are grandfathered into highly lucrative, since-retired utility rate plans that offer a significantly better return than today’s options. Grabbing one of these can substantially boost your monthly household budget.

As part of our educational webinar series, we teamed up with Realtor and Arizona solar home expert Tara Rutkowski to offer an educational webinar and guide specifically for buyers and sellers of solar homes. The free webinar includes a copy of our how-to guide: Buying and Selling a Solar Home, A Guide for Buyers, Sellers, and Agents.

To give you a taste of what the webinar covers, here are four tips to maximize a solar home transaction. If you would like to learn more, please contact us below.


1. Grandfathered Net Metering Homes Offer Bigger Returns

Net metering plans offered solar homeowners a dollar-for-dollar credit for any excess solar energy sent back to the grid. Newer rate plans cap the buyback rate to a fixed amount that is much lower. If a solar energy system was installed under an older net metering plan, there’s a good chance that the home will be grandfathered into this program for its 20-year contract. A buyer must transfer the electric service into their name without changing plans to assume the net metering benefits. If a different rate plan is selected, the net metering program will end, and the new homeowner will never be able to return.

These homes are highly prized because net metering offers a higher return rate. Sellers can maximize this value while marketing their home, and buyers can buy into a lucrative rate structure that has long since been retired. This is where working with a solar-savvy agent and appraiser pays off. They can help you identify a net-metered home and guide you through the transfer process to preserve the grandfathered status.


2. Pick a Solar-Savvy Realtor

When listing a solar home, choosing an agent with proven experience transacting solar homes is imperative. Don’t just take someone’s word for it. Ask for past client references. At the very minimum, a listing agent should be able to explain how solar works, understand the value of current and past rate plans, understand the solar lease or loan assumption process, and generally know how to market the value of the solar addition. Without this experience, leaving money on the table or botching the necessary paperwork to complete a transaction is easy.

The same applies when selecting a buyer’s agent. Suppose you want a solar-equipped home or plan to add solar after purchase. In that case, a solar-savvy agent can speak to the benefits of the different solar rate plans in different utility districts. Different plans can dramatically impact how much money solar panels will put back into your pocket every month. The home may be grandfathered into a net metering plan if a prospective purchase already has panels. A savvy agent will be able to spot these gems, and you’ll benefit financially.


3. Be Sure to Transfer Warranties

It’s important to contact the original system installer to determine the steps necessary to transfer an artistry warranty and verify the time remaining on any equipment warranties. Sadly, if the original installer is no longer operating, any artistry warranty will have died with their business. That said, a reputable installer should be able to help assess the status of any manufacturer warranties. Here at Sun Valley Solar Solutions, our 10-year artistry warranty balance can be easily transferred to one new buyer once a full system inspection is complete and the transfer form is completed.


4. Leased Solar Is Different From Owned Solar

Leased panels are not owned and must be transferred separately to a prospective buyer through a dedicated process. In short, a prospective buyer must arrange financing through the leasing company, including passing a credit check. When a buyer agrees to assume a solar lease, the mortgage company will often include that solar lease payment in the buyer’s debt-to-income ratio. Sometimes, this additional payment will impact the buyer’s ratios to a point where the home loan is impacted. For this reason, agents must vet any potential buyer thoroughly and deliberate with the transfer process. In the right hands, assuming a solar lease will look easy, with the wrong agent on your side, it can go sideways easily.