Massachusetts Home Buyer Guide

As more homeowners look for ways to protect the environment and save money on energy costs, more prospective home buyers in Massachusetts will consider buying a house with solar panels installed.

While solar panels are an eco-friendly feature that provides benefits, home buyers must be well-informed about solar-powered homes' implications and potential challenges. There are key considerations potential home buyers should keep in mind when purchasing a home with solar panels installed.

Energy Cost Savings: Buying a house with solar panels can significantly reduce or even eliminate your monthly electricity bills, providing long-term energy cost savings. Massachusetts home buyers should seek information about the system's age, efficiency, and overall condition to determine its value. Buyers should also consider and ask questions about the installed solar panels' energy generation. Understanding the system's capacity is crucial. Home buyers should evaluate the system's size, power output, and efficiency and consider factors such as the orientation and angle of the panels, any shading issues, and local weather patterns that might affect their performance. Home buyers should also learn about "net metering." You should consult a tax professional to see whether you can benefit from tax credit or rebate programs. 

Environmental Impact: Solar panels contribute to a greener future, reducing carbon emissions and reliance on fossil fuels. Familiarize yourself with the environmental benefits of solar energy and understand how your potential home's solar system will help the environment and aligns with your personal sustainability goals. Combining solar panels with purchasing an electric vehicle might energize your savings and improve your sustainability. Conversing with an energy professional before making an offer on a home with solar panels could provide helpful advice. 

Are the Solar Panels Owned or Leased?: Homebuyers must clarify whether the solar panels are owned outright or leased from a third party. If leased, carefully review the lease terms, duration, and potential restrictions or future obligations. Ask questions about the homeowner's savings, including requesting one year of electricity bills. Consider how the leasing arrangement may impact your ability to sell the home and transfer the lease to a new owner. Is there a warranty? Does the leasing company handle maintenance? Can the lease be paid in full at closing? You should ask your loan officer whether taking over a lease will affect your ability to obtain a home loan.

Solar Panel Power Purchase Agreement: A solar panel power purchase agreement (PPA) is a contract between a solar energy company and a customer. The solar company owns and installs the solar panels on the customer's property and then sells the electricity generated by the panels to the customer at a fixed rate for a specified period of time. The homeowner does not have to pay any upfront costs for the solar panels, and they can save money on their electricity bill. While a PPA is a relatively low-risk investment, the homeowner does not own the solar panels, may be locked into a long-term contract, and the electricity rate may not be as low as expected. If you're buying a home and taking over a solar panel PPA, you should make sure to understand the terms of the contract and ask your attorney to review it.

Maintenance and Warranty: Home buyers buying a home with solar panels should inquire about the maintenance history of the solar panels and any associated warranties. Understand what regular maintenance the system requires, whether it has been appropriately serviced, and by whom. You must familiarize yourself with the warranty coverage, including its duration, implications, and transferability limitations.

Insurance Considerations: Home buyers should contact their insurance provider to understand the implications of solar panels on their homeowner's insurance policy. It's essential to know whether the panels are covered against damage, theft, or other unforeseen events and if any policy adjustments are required to safeguard your investment. Prospective home buyers should contact an insurance agent instead of their insurance company. 

Value and Resale Value: Solar panels are considered a desirable feature in the real estate market. Research has shown that solar-powered homes sell faster and at a higher price than homes without solar systems. While solar panels can enhance a home's desirability and value, the impact on resale value may vary depending on the local real estate market and home buyer preferences. Depending on the age and design of the home, incorporating solar panels could pose aesthetic challenges that might affect a future sale. A dedicated buyer agent might have information about nearby sales of homes with solar panels installed. 

Energy Independence: Solar panels provide a level of energy independence, especially during power outages or grid disruptions. Solar panels alone won't work during a power outage, but when paired with solar battery storage, you can continue to use electricity even when local power is down. Solar panels do rely on sunlight, so their efficiency may vary based on weather conditions and available sunlight. Cloudy days or shading from nearby structures or trees can impact their performance.

By considering the factors above – savings; environmental impact; owned or leased panels; power purchase agreement; maintenance and warranty; insurance; resale value; and energy independence – prospective Massachusetts homebuyers can make informed decisions about purchasing a home with solar panels installed. Armed with knowledge, home buyers can benefit from savings and a reduced carbon footprint.