How rooftop solar can complicate residential real estate transactions

Many homeowners assume leased or loaned solar systems will boost their home’s value, but outstanding loans often drag down equity instead.

September 17, 2025 Phoebe Skok

Image: Greg Field

Navigating the complexities of the real estate landscape is already tricky; add in the wonky, technical nature of selling or buying a home with rooftop solar, and realtors and homeowners alike can find themselves mired in a maze of red tape and misconceptions.

“There are so many nuances to rooftop solar, which means there’s a fair amount about selling solar homes that most realtors don’t understand,” Greg Field, a solar home realtor at Homesmart who has nearly two decades of experience in renewable energy, told pv magazine USA.

He explained that in many cases, residential solar comes with grandfathered buybacks, meaning that the next person who purchases the solar home must assume the same rate plan as the original owner. What’s tricky, however, is that this can lock the new homeowner into a plan where the system and home lose value over time.

“A big misconception happens when a client takes out a loan on a solar system, thinking they own the system and that it will add value to the home when it’s appraised,” Field said. Here’s the catch: loaned solar can’t add any value to the home, only debt. In today’s lending climate, he explained, lenders want buyout almost exclusively, not a loan transfer.

“From the seller’s side, it’s a discussion about whether or not you can afford to lose this out of your equity and pay off the loan to sell your house,” Field said. “That’s a frustrating conversation because a lot of people assume that when they sign with a solar rep, they’re buying the system, even though in reality they’re borrowing and taking on debt.”

This misunderstanding can lead to homeowners ending up underwater, Field added.

Still, whether rooftop solar systems end up a boon or a burden for a seller isn’t always so clear-cut: it depends on what kind of value the homeowner locked in. For a home that’s two years into its lease and has a 3% escalator annually, “that’s not going to have tremendous value in today’s market against the utility since your rates are going up 3% every year.”

Deals like that won’t age well, Field added. On the flip side, he’s run into systems with a 10-cent locked-in rate and no escalator, which provides a “phenomenal” value against the utility.

Owned systems can be listed as assets with value, though recent policy shifts around residential solar tax credits are set to change the calculus.

“The homes that already have solar are going to be more valuable next year, and I’d look at homes with solar as being slightly more valuable than ones without,” Field noted.

He also pointed out that agents often don’t understand the value proposition and appraisal value of owned solar versus leased or loaned systems. That can lead to realtors improperly listing or showing those houses.

“Because most agents aren’t very comfortable with the subject, they don’t talk about it enough,” Field said. “What ends up happening is that a realtor will show the house but put the solar in their back pocket.”

“That becomes a sticking point,” he added.

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