What to know about Solar
What company services the property and what plans are available?
SRP & APS are the electricity providers here in the valley. Who services the property depends on where the property is located. Reviewing the utility bills of any property you are considering buying can be helpful, but particular when understanding the Solar value/offset for the property. This can vary greatly on what plan the owner currently has but it can give you an idea of how much the solar panels can cover. APS ended net metering August 31, 2017. SRP ended net metering December 9, 2014. If the seller had solar prior to these dates and did not change their rate plan, the land could be grandfathered in for net metering plans. To learn more about the different rate plans visit SRP or APS websites. Most properties will be tied and rely on the grid, even though batteries are starting to become more cost effective.
Are the solar panels leased, owned, or part of a solar program?
Solar leases all have different terms and conditions with different options when the home is sold. Finding out what the requirements to transfer the lease is crucial due diligence when considering buying a property with leased solar. Some leases may require the buyer to qualify with the solar company in order to transfer the lease. If there will be a mortgage involved it is definitely a good idea to check with the lender as to how they look at the lease payment. There may be qualifying issues with the way the lender calculates the payment. It is essential a utility bill but some lenders may look at it as a liability that goes towards your debt-to-income ratio.
If the solar is owned there is value to essentially pre-paid utility bills. The value is based on the age and size of the system. Talking with an experienced Realtor® can help determine what would be a reasonable value for the system. It is also important to get a GREEN Certified appraiser when getting an appraisal to ensure they have been trained in giving value for the owned solar system.
Solar program (aka 3rd party owned): if the property has solar it does not always indicate that they are part of the property. APS has a program that will essentially rent your roof space to install solar panels, giving you a monthly credit on your bill. They do not typically have a time commitment and tend to be very easily transferred to the new owners. It’s a great program to consider to have a little help on your monthly bill.
What is the age and size of the system?
Solar panels life span can vary. Each company will offer different warranty and life expectancy for the panels. It is good to do your due diligence on the servicing solar company when considering Solar. The size of the system plays a critical role in just how much power can be generated. Some choose partial systems, to partially offset the usage of power used by the house. Where others may have a full system that can produce power for the entire home. Keep in mind that it is common that any unused power goes back into the grid, unless the owners have batteries to store the generated power. Reviewing the home owner electricity bills can help with this.
*** If you have any questions about Solar on your new or current home, I am happy to help! There are many advantages to Solar beyond just going GREEN and feeling like it is the right thing to do. Most people will see a savings on electric bills when using solar. Plus, it gives you a predetermined rate for the next 20+ years while the electric companies raise their rates uncontrollably. However, like anything there are always many factors to consider if it makes sense for you, or not.