Bakersfield solar power company Bland Solar and Air Inc. both sells and leases solar panels, but owner Glenn Bland said he generally advises customers to buy rather than rent.
That's because if a homeowner decides to sell his or her house before the lease term is up, they must either convince the buyer to take over the lease, or purchase the system for potentially thousands of dollars, depending on how many years on the lease are left.
"I tell people if there's even the remotest chance they're going to sell their house in the next 20 years, they're better off buying," Bland said.
Solar power is an attractive option for homeowners in Kern County, where summer temperatures routinely soar into the triple digits. If there's one thing Kern can count on it's sunshine, and when you have solar panels, that can translate into hundreds of dollars off a monthly electric bill.
But now that home sales are picking up again in the aftermath of the housing crisis, some who signed long-term solar leases have run into a dilemma.
Under the terms of most agreements -- which typically span 20 years -- selling a house doesn't get you out of the obligation of the lease.
When a house is sold, the seller has to either buy the solar panels, transfer the lease to the buyer of the home, or relocate the panels to the new home (at a cost of roughly $3,000 for an average-sized system).
If you move the system, you'll need to communicate with your electricity provider because the state's solar rebate program is administered by utilities.
It's much more cost effective to transfer the lease, but that can only happen if the buyer is, first, willing to accept the obligation, and second, creditworthy, because solar companies won't rent to people with bad credit.
If for some reason a potential home buyer either doesn't want the obligation or can't get an agreement due to poor credit, they might just walk away from a sale.
So far, solar leases haven't proven to be significant deal breakers, said Scott Tobias, a broker with Prudential Tobias Realtors and president of the Bakersfield Association of Realtors.
"We haven't run into that many of them, to be honest, but when we do, it's absolutely essential that it's disclosed right up front," he said. "It doesn't create a problem unless it shows up at the last minute."
One option is to buy the system and bundle the cost into the sales price of the home, but that can cost thousands of dollars, which most renters don't have or they would have purchased the system to begin with.
The exact purchase price will vary depending on how many months are left on the lease and how much power the system generates.
The solar industry says far from blocking a home sale, solar panels make residences more appealing to potential buyers and boost a house's value.
The U.S. Department of Energy's Lawrence Berkeley National Laboratory released a study last year that found homes with solar systems sell for a premium over homes without solar systems, specifically about $17,000 more for a relatively new 3,100-watt photovoltaic system.
It's unlikely that anyone who didn't want solar power would respond to a listing for a home with solar panels, so by definition the people looking at such houses would be open to taking over a lease, said Susan Wise, a spokeswoman for San Francisco-based Sunrun, which markets solar panels in Bakersfield.
"You're selling a home with lower electricity bills that is also good for the planet," she said. "The lease transfers we've done have all gone smoothly, and the new homeowner is excited to have this as an option with their new home."
John Ojala took over the lease for a solar system on a Rosedale area house he bought a few months ago and says he has no regrets.
In his case, the seller had pre-paid the lease so he got all the benefits of solar without the monthly bill.
"I would have done it even if it hadn't been pre-paid," Ojala said. "My electric bill last month was $4.44, and it was $3.10 the month before that. I'm extremely happy. It's a great investment."
Sometimes, sellers raise their sales price to cover the cost of either buying a leased solar system or paying off the balance of their rental agreement.
Ojala assumes the seller of his home did that, but said he didn't mind.
"Any time you buy a house, the cost of any upgrades is part of the sales price," he said.
The vast majority of San Mateo-based SolarCity customers transfer their leases if they have to sell before the agreement is up, said spokesman Jonathan Bass.
Usually, buyers are glad to have it because even with the lease payments, their electric bills are going to be lower than they would have been if the house didn't have solar, he said.
"Most people like lower energy costs," Bass said.
Source: http://www.bakersfield.com/news/business/economy/x65918383/Solar-panels-may-create-dilemma-for-home-sellers
That's because if a homeowner decides to sell his or her house before the lease term is up, they must either convince the buyer to take over the lease, or purchase the system for potentially thousands of dollars, depending on how many years on the lease are left.
"I tell people if there's even the remotest chance they're going to sell their house in the next 20 years, they're better off buying," Bland said.
Solar power is an attractive option for homeowners in Kern County, where summer temperatures routinely soar into the triple digits. If there's one thing Kern can count on it's sunshine, and when you have solar panels, that can translate into hundreds of dollars off a monthly electric bill.
But now that home sales are picking up again in the aftermath of the housing crisis, some who signed long-term solar leases have run into a dilemma.
Under the terms of most agreements -- which typically span 20 years -- selling a house doesn't get you out of the obligation of the lease.
When a house is sold, the seller has to either buy the solar panels, transfer the lease to the buyer of the home, or relocate the panels to the new home (at a cost of roughly $3,000 for an average-sized system).
If you move the system, you'll need to communicate with your electricity provider because the state's solar rebate program is administered by utilities.
It's much more cost effective to transfer the lease, but that can only happen if the buyer is, first, willing to accept the obligation, and second, creditworthy, because solar companies won't rent to people with bad credit.
If for some reason a potential home buyer either doesn't want the obligation or can't get an agreement due to poor credit, they might just walk away from a sale.
So far, solar leases haven't proven to be significant deal breakers, said Scott Tobias, a broker with Prudential Tobias Realtors and president of the Bakersfield Association of Realtors.
"We haven't run into that many of them, to be honest, but when we do, it's absolutely essential that it's disclosed right up front," he said. "It doesn't create a problem unless it shows up at the last minute."
One option is to buy the system and bundle the cost into the sales price of the home, but that can cost thousands of dollars, which most renters don't have or they would have purchased the system to begin with.
The exact purchase price will vary depending on how many months are left on the lease and how much power the system generates.
The solar industry says far from blocking a home sale, solar panels make residences more appealing to potential buyers and boost a house's value.
The U.S. Department of Energy's Lawrence Berkeley National Laboratory released a study last year that found homes with solar systems sell for a premium over homes without solar systems, specifically about $17,000 more for a relatively new 3,100-watt photovoltaic system.
It's unlikely that anyone who didn't want solar power would respond to a listing for a home with solar panels, so by definition the people looking at such houses would be open to taking over a lease, said Susan Wise, a spokeswoman for San Francisco-based Sunrun, which markets solar panels in Bakersfield.
"You're selling a home with lower electricity bills that is also good for the planet," she said. "The lease transfers we've done have all gone smoothly, and the new homeowner is excited to have this as an option with their new home."
John Ojala took over the lease for a solar system on a Rosedale area house he bought a few months ago and says he has no regrets.
In his case, the seller had pre-paid the lease so he got all the benefits of solar without the monthly bill.
"I would have done it even if it hadn't been pre-paid," Ojala said. "My electric bill last month was $4.44, and it was $3.10 the month before that. I'm extremely happy. It's a great investment."
Sometimes, sellers raise their sales price to cover the cost of either buying a leased solar system or paying off the balance of their rental agreement.
Ojala assumes the seller of his home did that, but said he didn't mind.
"Any time you buy a house, the cost of any upgrades is part of the sales price," he said.
The vast majority of San Mateo-based SolarCity customers transfer their leases if they have to sell before the agreement is up, said spokesman Jonathan Bass.
Usually, buyers are glad to have it because even with the lease payments, their electric bills are going to be lower than they would have been if the house didn't have solar, he said.
"Most people like lower energy costs," Bass said.
Source: http://www.bakersfield.com/news/business/economy/x65918383/Solar-panels-may-create-dilemma-for-home-sellers
No comments:
Post a Comment