Increasingly, houseowners are having solar panels installed to generate electricity in return for helping to reduce their energy bills. It can also be seen as helping the environment by contributing to producing green energy and contributing to reducing greenhouse gas emissions.
What if you are buying a house with solar panels, or are considering having solar panels fitted, what do you need to consider?
There are 2 methods available to you when you install solar panels, depending on your financial circumstances. You can own the panels outright or you can enter a long lease. If you opt for the second option, you will become the landlord, and the solar panel company will be the leaseholder and rent roof space for a period of time. This is known as a long lease of the air space.
Financing Solar Panels
Own outright
If you have the available cash, you can purchase the solar panels outright. There may be government grants to assist with the cost. This is by far the easier method when you sell your property, but you will still be required to provide the buyer with all the necessary information, evidence of building regulations approval and details of how to change ownership.
Long Lease of the air space
If you do not have the available cash, you can enter a long-term lease agreement with a solar panel company. They will cover the cost of installation, and you will lease the panels to them over a period of time, usually 25 years, after which time the panels will revert to your ownership. This is sometimes referred to as Rent a Roof.
What if my property is Leasehold, can I still have solar panels installed?
This depends on whether you own a leasehold house (such as shared ownership) or leasehold flat. If you own a flat it is unlikely that solar panels will be available to you as the landlord, the person who owns the freehold title and will manage the building, will own the roof space. The electricity to the building will usually be transmitted to the building and each flat will be allocated their own meter.
If you own a leasehold house, such as shared ownership, you will need to obtain the permission from your landlord first.
What happens when I sell my house?
When you sell your house the solar panels whether bought outright or leased, will be transferred to the new owner. The Conveyancer acting for the buyer will need to carry out separate investigations in addition to the title review. There may be an additional fee for this. There will be standard enquiries that will be raised, and documents that they will request.
If you entered a long lease with a solar panel provider there will be 2 title numbers allocated at the Land Registry. The freehold title for the airspace registered in your name and the leasehold interest in favour of the solar panel company. Only the freehold title to the air space will be part of the conveyancing transaction and will be sold in addition to the legal title to your property.
What documents will I need to provide to the new buyer?
When the solar panels are installed, you should be provided with a building regulation completion certificate. This confirms that the relevant legislation has been complied with.
You will also require a MSC installation certificate and a roof survey. The roof survey will consider if any work is required to the roof to support the weight of the solar panels.
If you own the solar panels, you will benefit from regular payments for the electricity you generate. You will need to provide the new buyer details of your feed in tariff and how they notify the solar panel company about the change of ownership.
What if I am having a mortgage and the solar panels are subject to a lease?
Your conveyancer will need to ensure that the lease satisfies the lender requirements. If they do not, the lease may need to be varied.
What if I live in a conservation area, or my house is a listed building?
In addition to the above, you will also need to apply for planning permission from the Local Authority. If your property is listed, you will need to apply for listed building consent.
Next Steps...
If you're in need of a Conveyancer, please give me a call on 01283 561531 or email r.gibbs@timms-law.com. For more information, visit our Conveyancing webpage here.
