The Juno guide to buying a house with solar panels

The Juno guide to buying a house with solar panels

Solar panels are becoming increasingly popular with homeowners in Britain. They can be a great way to save money on your energy bills, as well as being environmentally friendly. However, when looking to buy a house with solar panels, there are a number of things to be aware of.

In this article, we’ll cover all the need-to-knows.

☀️ Leased solar panels vs owned solar panels

The first thing to consider is whether the solar panels are owned by the homeowner or leased by the solar company to the property owner.

Owned solar panels

In these cases, the homeowner has purchased the solar panels and they are registered to the property. This means that the cost of the solar panels are factored into the valuation of the house, and will be included when you buy it.

Leased solar panels

Under this arrangement, the homeowner leases out their airspace (in other words, their roof) to the solar panel company who install solar panels. Whilst the solar panel company still own the equipment, they let the homeowner have the benefit of the electricity at a reduced cost (between 5% to 25%), and allows them to sell excess energy to the National Grid through the Smart Export Guarantee (SEG) scheme.

The terms of this agreement are set out in a lease agreement, which is a legal contract between the homeowner and the solar company. When you buy a house with leased solar panels, you will take on the lease.

💷 How do solar panels affect the value of a house?

As we’ve already mentioned, the value of a house with solar panels is affected by whether the panels are owned or leased. If the panels are owned and in good conditions, they can increase the value of the home. This will depend on the age and condition of the panels, how long the warranty has left, how well the panels have performed in the past, and how expensive energy is at that time.

Whilst leased panels do not technically enhance the value of the house, they can still be seen as a benefit, although some buyers are less keen to buy a property where they will not actually own the solar panels, and there can be some complications with a buyer easily taking the benefit of any existing feed-in tariff agreement.

👩‍💼 Your conveyancer’s role in the process

Owned solar panels

With owned solar panels, your conveyancer will need to find out:

• Find out how and where the panels are installed on the roof
• Get the sellers to provide a Microgeneration Certificate Scheme (MCS) certificate or a Building Regulations certificate for the installation
• Get an electrical certificate for the installation of the electrics from the sellers
• Discover whether any work has been done to strengthen the roof to support the panels - this also requires a Building Regulations certificate
• Find out whether the solar panels are part of the feed-in tariff scheme - this was a government scheme that gave tax-free payments generated by the solar panels. The scheme still runs for people who signed up, and you’ll benefit from it if you buy a house with solar panels.
• Find out whether the solar panels are part of the Smart Export Guarantee scheme which allows homeowners to sell their surplus electricity back to the grid and receive payments for the electricity they generate

Leased solar panels

With leased solar panels, the process is more complex. Your conveyancer will need to find out about the following:

Property and Installation

• Ensure that the property was inspected by a qualified professional before installation
• Check the lease is under 30 years when it began
• Confirm that all of the necessary legal permissions were given for the installation such as planning permission and building regulations

Insurance and Liability

• Check that the equipment was insured during installation and is insured for the duration of the lease
• Check that the solar company has provided liability coverage for property damage and personal injury
• Confirm that the existing homeowner has informed their buildings insurer about the installation

Maintenance and Costs

• Check that the company responsible for maintenance has charged an annual maintenance fee of no more than £60
• Check if the lease requires the homeowner to maintain any surrounding trees and shrubbery that could affect the panels

Roof Access and Equipment Removal

• Check that the lease allows for the equipment to be removed for essential repairs
• Check that the lease does not require the homeowner to pay for any Feed-in-Tariff losses
• Check that the lease does not require the homeowner to pay for any removal or reinstallation of the equipment

Your conveyancer will also have to ensure that the lease is compatible with the mortgage you are taking out on the property. As you can see, this is a complex process and it’s important to get it right.

🏡 We’re here to help

Buying or selling a house with solar panels is a complex process. Here at Juno, our conveyancers are experienced in handling these transactions and will ensure all enquiries are raised on your solar panel house. Click here to get started.