Is Buying a Home With Leased Solar Panels a Smart Idea? Here’s Some Help!

If you’re thinking about solar panels for your home, you may be wondering if it’s worth buying a home with …

If you’re thinking about solar panels for your home, you may be wondering if it’s worth buying a home with leased solar panels. The short answer is yes! Solar contracts are almost always going to save you money each month on power bills. The only time a lease would negatively affect you is if your monthly power consumption significantly decreases after signing the contract–essentially, you’d be paying for something that isn’t benefiting as much as before.

A house with solar

Solar installations are expected to reach four million by 2023, as reported by SEIA. This is a staggering number of homes, and buying a home with leased solar energy systems is becoming an increasingly popular option.

With the solar industry on the rise, homes with already installed solar panels are becoming more common.  When purchasing one of these properties, it’s important to know if the seller owns the system outright or if there are monthly payments still owed.

What financing options are available?

Before we discuss whether purchasing a home with solar panels is wise, let’s compare and contrast the different options for getting solar panels financed:

Leased solar panels

Home sellers with solar leases are leasing the solar system installed on their home from another company, similar to how someone would lease a car. The current homeowners make monthly payments to whoever owns or is financing the purchase of the system, and if you purchase the home, then you will take over these responsibilities.

If buying a home with a leased system appeals to you, make sure that your offer includes taking over the payments on the solar lease. When this is part of your offer, the current owner can pass their lease onto you, the new homeowner.

Power purchase agreement (PPA)

A PPA is similar to a solar lease in that you are buying electricity from the company that owns or finances the system. With this agreement, you agree to buy all of the home’s electricity at a locked-in rate for a set period. This allows you to save money on your utility bills without having to buy the system outright.

Buying a home with a PPA is similar to buying one with a solar lease. Before buying, make sure that you understand the terms of the PPA and are comfortable taking over any payments or responsibility for it.

Cash purchase

If buying a home with leased or financed solar panels doesn’t appeal to you, buying a home with a solar system that is paid for in full could be the best option. This is usually more expensive than buying a home with leased or financed solar systems but it will give you complete control over your energy usage and costs.

Buying a home with cash-paid solar panels is also beneficial in that you will not have to worry about taking over payments or responsibility for the system. This is something to keep in mind when buying a home with solar panels.

Solar loans

Another option is buying a home with solar panels that have been financed by a loan. In this case, you’d be buying the system outright from the current homeowner and taking over their loan payments. The advantage of buying a solar loan instead of a lease is that you’d eventually own your solar system and won’t have to worry about making payments after the loan is paid off.

Buyers should take time to research and compare solar loan terms, such as interest rates, repayment plans, and other financing options before buying a home with a solar loan.

Property-assessed clean energy (PACE) financing

PACE financing is linked to the property instead of the individual, which makes it different from a solar lease, PPA, or private loan.

A “land-secured financing district,” more commonly seen in clean energy projects, is what’s called PACE financing. It may also go by the names of an assessment district, a local improvement district, and so on. With a typical assessment district, the project at hand (for example streetlights or underground utility lines) gets paid for when the local government issues bonds.

PACE (Property Assessed Clean Energy) is a financing model used to pay for energy efficiency and renewable energy. With PACE, property owners make improvements without having to come up with all the money upfront. Property owners who choose to participate in a PACE program repay their improvement costs over time—usually 10-20 years—through property assessments, which are paid as part of the owner’s property tax bill.


Buying a home with PACE financing is similar to buying one with an energy efficiency loan in that you’ll be taking over the payments on the loan when you purchase the home. Be sure to understand all of the terms before buying a home with PACE financing.

buying leased solar panels are a packaged deal most of the time

The leased solar panels are a packaged deal most of the time

The only time solar panels will affect the sale of a home is if they are being leased from a solar company. If so, the seller must transfer the lease to the buyer, or else the buyer has to purchase outright from the solar company–which would conclude the lease early. The choice of how (or even if) to proceed lies with the Solar Panel Buyers themselves.

The benefits of transferring a solar lease are twofold: sellers eliminate future payments on the lease and often incur no costs to do so.

Agreeing on a solar lease can be tedious, and you may have to hold off on the closing until the solar company agrees to let the buyer assume the lease. There might also be a transfer fee for taking over the lease that you’ll need to account for. Who covers this cost could potentially make or break your negotiations.

Does a solar panel system increase my home value?

When you buy solar panels, it not only makes your home more valuable but also provides the potential to save money on energy bills. Furthermore, having solar panels installed in a home is seen as a convenience by many people. 

When it comes to leased solar panels, the same principles do not apply. The homeowner does not own the system in this case- the leasor does. Even though there is no increase in value for the home, there are still potential energy savings to be had by going solar.

What if the seller wants me to assume a solar lease?

If you’re interested in assuming a lease for a solar energy system, you must contact the corresponding company to comprehend what you’ll be responsible for. This includes whether there are monthly payments and if they will eventually increase. Furthermore, you have to go through a credit check before the lease can be transferred into your name.

A deal for a house

How to transfer a solar panel leases

The first step to transferring a solar panel lease is to contact the company that owns the system. They will most likely ask for properly filled out forms and documents, such as proof of ownership or a signed agreement. Additionally, you might need to provide financial information and undergo a credit check.

When buying a home with leased solar panels, it’s important to understand the details of the solar lease, as well as your potential obligations. Make sure you have a thorough understanding before buying a home with leased solar panels—it could be a key factor in your buying decision.

It’s also important to consider any upfront costs associated with buying or transferring the solar lease, such as transfer fees and credit checks. Knowing the details of buying a home with leased solar panels can help you make an informed decision about your purchase.

Bottom line: Buying a home with leased solar panels

A house with solar panels could be a smart investment, or it may not make sense for you depending on your current financial situation. If you’re interested in saving money long-term, then purchasing the less expensive home without solar panels is probably the wiser choice. However, if you do decide to buy a home with solar panels, you may eventually be able to sell it above market price because of the addition of the solar system, even if it’s leased. Some buyers would no longer have to go through the long process of getting their system activated from the point of sale to permission to operate from the local utility company.

Before you buy a home with solar power, make sure to find out if the system has any attached financing, like a loan or lease that you would have to take over. You can ask the seller about this before making an offer on the house. Also, talking to a financial advisor can help you figure out if taking over someone else’s solar lease is the right move for your finances.


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I have years of experience in solar energy, and I believe that we as a society must move towards utilizing clean energy sources. We have made significant advancements in this area over the past few years, but there is still more work to be done. I hope that sharing my knowledge and experiences will help others understand the importance of moving towards cleaner forms of energy production.

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