The solar panel contracts that can kill home sales

Key Points

  • Solar Leases as Liabilities: Many homeowners lease solar panels instead of owning them, leading to long-term contracts with high monthly payments, annual increases, and complications during home sales.**
  • Impact on Home Sales: Solar leases can deter potential buyers who may struggle to qualify for or refuse to assume the additional financial burden, often forcing sellers to pay off contracts early at significant cost.**
  • Growing Popularity of Leases: As of mid-2024, 36% of residential solar projects were leased or under similar arrangements, a rise from 22% three years prior, driven by lower upfront costs despite long-term financial drawbacks.**
  • Tax Credit Changes: The expiration of a 30% tax credit for purchasing solar systems in 2025, while commercial credits for leasing companies remain, is likely to further increase the popularity of solar leases.**
  • Owned Solar as an Asset: Owned solar panels can increase home value by 6.9% and offer long-term savings on rising electricity costs, making them a more attractive option compared to leasing.**

Summary

This article explores the complexities of solar panel adoption in the U.S., focusing on the pitfalls of leasing versus owning. While solar promises reduced utility bills and increased home values (up to 6.9% per SolarReviews), many homeowners lease panels, entering contracts up to 25 years with escalating payments and early buyout fees. These leases become liabilities during home sales, as buyers often hesitate to assume the financial burden, sometimes forcing sellers to pay off contracts costing tens of thousands. Despite this, leasing has grown, with 36% of solar projects under such arrangements by mid-2024, up from 22% in 2021, fueled by lower upfront costs and recent tax credit changes favoring leasing companies. The expiration of a 30% purchase credit in 2025 may push more toward leases, though experts warn of long-term costs. Owned solar, conversely, is highlighted as a valuable investment amid rising energy costs, with real estate agents and homeowners like John Bulik in Denver advocating for ownership over leasing due to its financial and practical benefits. The article underscores the need for better consumer education on solar contracts to avoid misleading sales pitches and ensure informed decisions.

yahoo
January 18, 2026
Stocks
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