Solar panels could hit house sale

Despite Energy Minister Greg Barker’s announcement that householders could get paid hundreds of pounds a year for heat generated by solar thermal panels*, purchasing homes with them can stop buyers obtaining a mortgage if the roof has been “rented” to a utility supplier, according to recent research by independent home finding company County Homesearch.

Currently, there are almost 300,000 homes** in UK with solar panels which either can be owned outright by the householder or fitted and rented out to a utility supplier. If a householder opts to rent the roof space out to a green energy company it may cause a sale to falter.

CASE STUDY

Stephen Wolfenden, local director for Oxfordshire, was recently asked to advise a client who was considering the purchase of a property with solar panels and several issues arose.

Says Stephen Wolfenden: “The seller was receiving a positive revenue from the panels and saw it as a real benefit and something which would add value to the property, on the other hand ownership of the panels was unclear and my clients mortgage provider was unwilling to lend unless ownership was passed on to the purchaser. 

"Often these panels are installed by solar companies for free who then sell extra energy generated back to the grid. These schemes are usually based on 25 year leases which require the approval of the mortgage lender.”

Three questions which County Homesearch asks of a property with solar panels:

1. Do the panels increase or decrease the value of a property for aesthetic reasons? A Cotswold cottage with solar panels may well be a turn-off and reduce its value while a modern town house with them maybe a plus and a revenue earner.
2. Can the seller confirm who owns the panels? If they have been put up and owned by a power company on a 25 year lease that may be a problem as lenders will be reluctant to lend on that basis. A legal transfer of ownership will need to take place.

3. Having solar panels on the roof - which are very heavy - might undermine the roof’s structure and it’s advisable to inform the insurance company that they have been installed.