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Residential solar leases are creating complications for homeowners looking to sell their properties, according to a report from Yahoo Finance. The pitch for solar often highlights slashed utility costs and increased home values, but many homeowners lease their panels under contracts that can run up to 25 years and come with monthly payments, annual increases, and hefty early-purchase prices.
Real estate agents say solar leases have emerged as a frequent sticking point in negotiations as buyers gain ground in many parts of the country. Sellers often end up paying off their contracts early, often for tens of thousands of dollars, to prevent buyers from walking away. Buyers may struggle to qualify to assume the long-term liability on top of a mortgage or refuse to take over a contract they did not sign.
“When you go to sell the house, if you don’t pay off this system, the buyer has to qualify not just for buying the house, but also for this lease,” said John Bulik, a real estate agent in the western suburbs of Denver. “It can knock out some potential buyers, and we see a lot of buyers not wanting to go through that hassle.”
Residential solar has grown in popularity in the past two decades, spurred by interest in green energy, high electricity prices, tax incentives, and technological advances. Nationwide, around 8% of homes now have solar, with far higher numbers in states like Hawaii, California, and Arizona.
While leasing removes up-front costs and maintenance responsibilities, homeowners often end up paying more and seeing energy savings diminish over time due to contract clauses that increase payments annually. Despite the downsides, leases have been growing in popularity. As of mid-2024, around 36% of residential solar projects were leased or under a lease-like arrangement known as a power purchase agreement, up from 22% three years earlier, according to solar research firm Ohm Analytics.
Solar remains a significant investment; in 2025, Tesla put the cost of an average system at $21,900 to $26,400.
Source: IndexBox Market Intelligence Platform
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