Escrow Killer

Qu’est ce que c’est?

In a seller’s market, buyers tend to be more forgiving of issues and lack of remedy for issues. In a buyer’s market, houses need to be clean and ready; buyers are less tolerant. What none of us foresee is how fads and grifters can make real estate transactions fail. In my opinion, solar panels are a fad pushed by grifters.

When homeowners are led to believe that solar panels on their roof will 1) be good for the planet, 2) be good for their finances, 3) be good for years, and 4) good for resale value, they are being mis-led.

I can only personally speak to #4. Over the last 5 years, a growing number of homes have installed solar panels on their roofs. My sellers and buyers have been confronted with the possibility of selling or buying a home with “owned” or “leased” solar panels. In ALL cases of selling a home with an “owned” solar system, it has been successful. In ALL cases of selling a home with a “leased” solar system, there has been a failure or many issues during the transaction.

Ask any honest escrow/title employee, they will agree that Solar Lease Companies are frequently unbearable and sometimes a hostile entity.

Here is MY understanding of the math behind solar:

  • Government provides subsidies to homeowners who get solar panels.
    • Would a subsidy be required if there was economic value?
    • Does this subsidy get passed on to the next homeowner?
  • Builders are “required” to include solar panels in new homes.
    • Would a building permit be possible if there were no panels included?
    • Do builders decrease their prices by the amount of subsidies they may get?

Any subsidy, by accounting principles, is an asset to the receiver. It is cash. It is part of calculating the Return On Investment (ROI) for the installed system. If this asset is not conveyed with the home/system, then the only thing being sold is a liability called a lease payment.

Let me know if you have a different experience.

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Jay Emerson, Broker

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