What If We Plan To Move?

Modern day solar electric installations are designed to last for decades, much longer than the average American remains in their home. A common question we hear is, “I expect to move in five years — does it make sense to go solar now?” The answer depends on a number of factors, and the value that you personally assign to each of these factors. Here are some to consider:

  1. How will the solar system affect the value of your home when it’s time to sell? Currently there is no accepted metric for determining exactly how much a solar electric installation will increase your home value, but it generally will increase the value by some amount (unless it’s a solar lease or a PPA). Imagine looking at a home for sale in a neighborhood in which homeowners are spending $2000 – $3000 per year on electricity, but this homeowner spends close to $0 per year on electricity — would you pay more for that home?
  2. How long will it take to recoup my solar investment? In SDG&E territory, the answer is typically between 4-7 years at current electric rates, depending on the configuration of your roof and on your electric usage. However, if you consider that you would also recoup some additional value from the solar should you sell your home, the “payback period” decreases to 2-4 years. It also decreases if you consider future utility electric rate increases.
  3. If you plan to rent out your home when you move instead of selling it, it’s important to consider that a solar home can garner higher-than-market rates. Renters may be happy to pay an extra $100 – $150 per month in rent if the solar system will save them $200 per month.
  4. The 30% residential solar tax credit is in place for systems installed and “placed into service” during 2019. After that, the tax credit will step down, and then disappear altogether for systems put into service after 2021. It makes sense to capture these government incentives while they are in place, because the next homeowner will not be able to.
  5. Net Energy Metering (NEM) rules changes over time as the electric grid is comprised of more and more renewable energy. These rules dictate the value that homeowners can obtain from their solar electric system. Each time these rules change they become less favorable to new solar homeowners. However, any residential solar installation placed into service under the current NEM rules in California will remain under these rules for the next 20 years, even if the home is sold during this time period. This makes a solar system installed now more valuable than one that might be installed under future NEM rules.
  6. If offsetting your carbon footprint is part of your motivation for considering solar, then installing a system can be a way for you to leave an environmental legacy beyond your tenure in your home. It’s reasonable for considerations other than financial to be an important part of your decision-making process.

If you expect to eventually move, but plan on going solar now, then we recommend:

  1. Go solar with an established and reputable contractor that you expect to stand the test of time. Remember, bigger is not necessarily better when it comes to residential solar installers. As with other trades, you should look for a solar installer who’s business model relies on referrals from happy customers instead of on a big marketing budget.
  2. Choose solar equipment from established manufacturers with a strong balance sheet. Not all manufacturers stand the test of time either.
  3. Pay attention to aesthetics. Become involved with the system design, even down to the conduit run. Avoid “reverse-tilt” installations on your roof if at all possible, as they have been known to be so aesthetically unappealing as to solicit complaints from neighbors. The last thing you want is for your solar system to be a liability when selling your home, instead of an asset.
  4. Make sure all warranties are transferable, and that you have all the records you’ll need to pass on to the next homeowner.
  5. Consider that if you finance your solar installation that you will likely have to pay off that loan when you sell your home.
  6. Shy away from solar leases or Power Purchase Agreements (PPAs). Prospective homebuyers may not want to assume a monthly lease or PPA payment for a solar system, making your home more difficult to sell. In many cases the sellers of a home end up buying out the remainder of their solar lease at an inflated price in order to sell their home.

San Diego County Solar is a local and established residential solar contractor with a focus on quality and the customer experience. If you would like to learn more about solar for your home, please contact us for an educational consultation (not a sales pitch).