Solar panels are common in Connecticut due to incentives encouraging homeowners to go solar. If you are on the market to sell your CT house with solar panels, you must understand how these systems work and how they’ll affect the purchase price and process. This guide will walk through everything you need to know to sell your Connecticut home with solar panels for cash.
Confirm the Ownership
First, you should inform the buyer whether the solar panels are owned outright, leased, or financed in some way. It makes a big difference in how the sale can proceed. If you purchased the panels with cash and have no outstanding payments due, that’s the best-case scenario. The sale can move forward without any complicated process and additional paperwork.
However, many Connecticut homeowners chose to lease their solar systems, which means a solar company owns the equipment. The homeowner pays a monthly fee, but they don’t hold the panels. In this case, the lease must be transferred to the new owner as part of the home purchase. The solar company will need to approve the new lessee. It can be a complicated process if the new buyer of your home does not qualify.
Sometimes, a solar loan is secured by the property that needs to be paid off before the sale. Or the panels were purchased with an unsecured loan not tied to the home. No matter what, you need complete documentation showing the details of any existing solar contracts, warranties, and ownership status. We consider this information when making a cash offer for your house.
Transfer Solar Leases and PPAs
If the solar panels are leased or under a power purchase agreement (PPA), extra steps are required for the transfer. With a lease, the monthly payments simply shift to the buyer. However, the buyer must qualify and get the leasing company’s approval first.
The solar company will likely want to see the buyer’s credit history and financial documents to verify their ability to take over the payments for the system. If the buyer doesn’t qualify, the seller may have to pay off the remaining lease balance to close.
A PPA functions similarly, except the previous owner bought solar energy from the installation company, not leasing the gear itself. So, you would be transferring the power purchasing contract, not a lease. But the same qualification process applies whether you take over the lease or transfer the PPA.
Transfers can take time, so sellers should inform solar companies of the planned sale as soon as possible. Consider the time added to wait for the transfer, as it can be significant. It can add weeks to the closing time.
Appraise the Solar System
Solar panels can increase the value of your house, but to appraise the solar system, you need to get help from an expert. They will accurately assess the system based on factors like the quality of the panel, solar equipment like batteries, and their age and condition. An expert will check for the expected remaining useful life and the local electricity rates to calculate projected savings.
There are appraisal methods specific to homes with solar systems. An income-based appraisal looks at lifetime income generated, and market-based compares prices of similar homes. The correct valuation method goes a long way in justifying the home’s price and establishing what a buyer should pay.
For owned systems, the panels often increase property value. However, value can decrease for leased systems because the equipment belongs to the solar company. We will get an appraiser who understands solar homes to get the right valuations.
Maintain Proper Documentation
When buying a Connecticut home with solar panels, documentation is critical. Keep these documents handy. We will require them when we are making an offer for your home.
- Solar panel ownership, lease, or PPA contract
- Warranties and service agreements for equipment
- System specifications like panel models, inverter details, installation specs
- Performance history and projected output estimates
- Details on incentives like Solar Renewable Energy Credits (SRECs)
It helps us understand the solar panels, make plans for maintenance and upkeep, understand warranty transfers, and calculate energy savings. All contract transfer terms must also be clear for lease or PPA systems.
Set Clear Expectations
You must have clear expectations when selling your home with solar panels. Solar panels don’t automatically make a home more valuable or attractive. The price of your house may increase or decrease based on the status and condition of the solar panel. Here are some questions that you need to consider.
- How old is the system? Older panels have a shorter useful life remaining.
- What condition are the panels in? Damage or underperformance would bring down the value.
- Is solar electricity generation sufficient for the home’s needs? A solar panel that gives Insufficient output doesn’t add value to the house.
- How much longer is the equipment under warranty? A shorter warranty period lowers the house’s value as it might mean costly replacement.
- How much is still owed for systems leased or under PPA? Higher remaining payments can decrease the home price.
You must set clear expectations about your home solar system. If you haven’t priced the home right, it may be difficult to get a deal.
Things to Consider While Closing
Once we’ve agreed on a price, we must handle several solar-related details at closing. If the solar system is leased, complete all the new contract paperwork with the solar company to transfer the lease officially to Neighbor Joe. This paperwork allows us to take over the remaining lease payments and obligations. It must be finalized and signed by all parties at closing.
If the solar panels come with renewable energy incentives like Solar Renewable Energy Credits (SRECs), the buyer must transfer the documents to Neighbor Joe. We’ll need the paperwork to continue collecting those incentives on the home’s power generation. Verify if there are any active solar warranties, performance guarantees, or service and maintenance plans that cover the equipment or installation work. These types of agreements can increase your home prices.
For grid-tied solar arrays, get the utility approval of the net metering agreement. The seller must transfer the agreement to the buyer to continue benefiting. It prevents any disruption in the net metering credits that help offset electric bills. Before closing, you must inform the utility of the ownership change.
Taking extra time at closing to be thorough about the solar panel system transition means we can avoid surprises down the road. It sets me up for smooth, trouble-free ownership of the existing solar array. Before closing, our team will conduct one final inspection of the solar panels and electrical components. It allows us to find and fix any issues before closing.
Neighbor Joe is willing to pay a fair price for homes with solar, especially if they are owned outright. Our advice is to be open and detailed about the specifics of your solar setup from the start to get the right price for your house. Keep all the documentation ready to reduce the closing time and get cash for your solar homes in Connecticut.
We at Neighbor Joe buy any kind of house in Connecticut regardless of its condition. You can sell your house to us as-is. Contact us today, and we will provide a fair price quote within 24 hours. If you decide to accept our offer, we can close within 7-14 days, depending on your needs. We buy your house quickly whether you are trying to avoid costly repairs, foreclosure, or getting rid of bad rental or inherited property. You get cash for your property and can move on to the next chapter of your life without a troubled property weighing you down.