Buying a Home With Solar Panels in San Diego County: What to Know Before You Make an Offer
Updated: 20 hours ago
So you're looking to buy a home that has a solar system already installed. Here's something most buyers don't realize: most home inspectors, Cedrus included, do not inspect solar panel or battery systems. It's not an oversight. A standard home inspection is a broad, generalist look at a property's major systems, and solar equipment requires its own specialized knowledge and testing equipment that falls outside that scope.
If you're curious what a standard home inspection does cover, our guide to what a home inspection covers and what it doesn't walks through it in detail.
That doesn't mean you should ignore it. This post covers what you should know before you make an offer: the difference between an owned and a leased system, the questions worth asking, the maintenance you should expect over time, and whether a separate solar inspection makes sense for your situation, and who you'd actually call for one.
Owned vs. Leased (and Everything In Between)
The single most important fact to learn about a solar system isn't its age or how many panels it has. It's how the system is owned.
Solar systems typically fall into one of a few categories:
Owned outright. The homeowner purchased the system in cash or paid off a loan, and it comes with the home.
Financed with a loan that is still being paid off.
Leased from a solar company, with the homeowner paying a monthly lease payment rather than owning the equipment.
Under a power purchase agreement (PPA), where the homeowner pays for the electricity the system produces rather than for the equipment itself.
An owned system is straightforward. It transfers with the home like any other fixture, and it can genuinely add value to the property.
A leased, financed, or PPA system is more complicated. The remaining obligation doesn't simply disappear at closing. In most cases, it needs to be transferred to the buyer, paid off by the seller, or bought out, and the process usually involves the solar company, both real estate agents, and sometimes the buyer's lender. Some solar loans also file what's called a UCC-1 lien against the property, which the title company will need to identify and clear before closing. If a loan payoff or lease transfer isn't accounted for, it can catch buyers, sellers, and even agents by surprise late in a transaction.
Questions to Ask Before You Write an Offer
Before submitting an offer on a home with solar, it's worth getting clear answers to a short list of questions:
Is the system owned, financed, leased, or under a PPA?
If it's financed or leased, what is the remaining balance or term, and what does transferring it involve?
How old is the system, and who was the original installer?
Is the installer still in business? Solar companies close or get acquired more often than most buyers expect.
Are the manufacturer and workmanship warranties still active, and do they transfer to a new owner?
Is production monitoring data available to review?
What is the system's interconnection date with SDG&E? (More on why this matters below.)
Most sellers and listing agents can gather this information fairly quickly if asked, and having it in hand before you write an offer can save a lot of back and forth later in escrow.
Your Relationship With SDG&E
Every solar system connected to the grid has a formal billing relationship with the utility, and in San Diego County that means SDG&E. This relationship isn't the same for every home, and it can make a real difference in what the system is actually worth to you.
For years, SDG&E credited solar customers under Net Energy Metering (NEM), a program that paid close to the retail rate for excess electricity a system sent back to the grid. Homeowners who connected their systems under NEM 2.0 were allowed to stay on that billing structure for 20 years from their original interconnection date, regardless of who owns the home during that time.
That changed on April 15, 2023, when SDG&E and California's other major utilities moved new solar customers to a new structure, officially called the Net Billing Tariff, though SDG&E refers to it as the Solar Billing Plan. Under this newer program, exported electricity is credited at something closer to the wholesale value of that power, which is often significantly lower than the retail rate, rather than a straightforward one-to-one credit. The legacy period for the newer plan is also shorter, at 9 years rather than 20.
In practical terms, this means two homes with what looks like the same size solar system can be worth very different amounts to a buyer, depending on which billing structure they're on. The way to find out is to ask for the system's interconnection date (sometimes called the Permission to Operate, or PTO, date) or to look at a recent SDG&E bill, which will indicate the billing plan the home is enrolled in.
Maintenance You Should Anticipate
Solar systems are often marketed as low maintenance, and for the most part, that holds up. But low maintenance isn't the same as no maintenance, and understanding what actually ages in a solar system helps you budget appropriately.
Solar panels themselves degrade very slowly, typically losing around half a percent of their output capacity per year. A panel installed 15 years ago is likely still operating at roughly 90 to 95 percent of its original output. Most panels are built to last 25 to 30 years.
The component that tends to need attention first is the inverter, the piece of equipment that converts the electricity your panels generate into power your home can use. Standard string inverters typically carry warranties in the 10 to 12 year range, while microinverters (installed at each individual panel rather than as one central unit) often carry warranties closer to 25 years. If a system is more than a decade old and uses a string inverter, there's a reasonable chance it's approaching, or has already needed, a replacement.
Since a solar system ties directly into your home's electrical service, it's also worth understanding how your electrical panel is inspected, since panel condition and capacity can matter when a home has solar.
Beyond the inverter, routine upkeep for most systems includes occasional panel cleaning, since dust and debris reduce output, and periodically checking the production monitoring app or portal to confirm the system is generating the amount of electricity it's expected to.
Should You Get a Separate Solar Inspection?
In many cases, yes. A separate solar inspection isn't necessary for every San Diego County transaction, but it's worth strongly considering in a few specific situations:
The system is leased, financed, or under a PPA, and you want an independent read on its condition before assuming the obligation.
The system is more than 10 years old, particularly if it uses a string inverter.
No production monitoring data or maintenance history is available.
Solar makes up a meaningful part of the home's value story, and you want documentation before finalizing your offer.
A solar-specific inspection typically checks things a general home inspection isn't equipped to test: actual system output compared to its rated capacity, panel and wiring condition, inverter function, and code or safety issues specific to solar installations.
Who Do You Call for This?
A qualified solar inspection typically comes from one of a few sources:
A NABCEP-certified solar professional. NABCEP is the leading certification body for solar installers and technicians in North America.
A licensed electrician with specific solar experience.
A dedicated solar inspection company that doesn't also sell or install systems, which helps ensure the evaluation stays independent.
That last point is worth emphasizing. Just as you'd want a home inspector who has no financial stake in the sale, it's worth looking for a solar evaluator who isn't also trying to sell you a new system or a service contract.
How Cedrus Fits In With Solar Panels in San Diego County
A full home inspection from Cedrus Property Inspections covers the condition of your home's major systems, from the roof to the foundation. Solar is a specialized exception, one that deserves its own set of eyes. Understanding the difference between owned and leased, knowing your SDG&E billing arrangement, and asking the right questions upfront can save you from an unpleasant surprise well after you've moved in.
If you're getting ready to make an offer on a home with solar, or you just want a thorough inspection of everything else the system doesn't cover, reach out to Cedrus Property Inspections to schedule your inspection.
Frequently Asked Questions
Does a solar lease automatically transfer to me when I buy the home?
Not automatically. Most solar leases require the buyer to qualify for the transfer, similar to assuming a loan. If you don't qualify or don't want to take over the lease, the seller may need to buy out the remaining term or have the equipment removed before closing.
Should I avoid buying a home with a leased solar system?
Not necessarily. A leased system isn't a reason to walk away from an otherwise good home, but it is something to factor into your decision and your offer. If you're comfortable with the transfer process and the numbers work in your favor, plenty of buyers take over an existing lease without issue. Where it's worth being more cautious is if the lease has many years remaining, the payments are high relative to what you'd otherwise pay SDG&E, or the transfer requires a credit qualification you're not confident you'll meet. In those cases, it's reasonable to ask the seller to pay off the lease, negotiate the price down, or request the system be removed before closing.
Can I negotiate the price if a home has a leased or financed solar system?
Often, yes. Since a leased or financed system is a liability you may be taking on rather than a pure asset, it's a reasonable point of negotiation, especially if the remaining payments or buyout cost are significant.
Does owning solar panels outright increase a home's value?
Generally, yes, an owned system is considered a value-adding improvement, similar to a new roof or an updated kitchen. How much value it adds depends on the system's age, condition, and the strength of its SDG&E billing arrangement.
What if the seller doesn't know whether the system is owned or leased?
This happens more often than you'd expect, especially if the current owner wasn't the original purchaser. A quick way to find out is checking the county recorder's office for a UCC-1 filing, or asking the solar company directly with the system's address or the homeowner's name.
Were solar permits required when the system was installed?
Yes, solar installations require permits and a final inspection from the local building department. If a system was installed without permits, it can complicate financing, insurance, and resale, and is a good reason to ask for the permit history before buying.
Can solar panels affect my homeowners insurance?
They can. Most insurers want to know a system exists, and some may require documentation of professional installation. An unpermitted or poorly documented system can occasionally cause coverage issues, which is one more reason permit history matters.
How much does a separate solar inspection typically cost?
Pricing varies by system size and company, but it's generally a modest cost relative to the value of the information, especially compared to the cost of discovering a problem after you already own the home.
If I stay on NEM 2.0, does that benefit transfer to me as the new homeowner?
Yes. NEM 2.0 legacy status is tied to the property's interconnection date, not the original owner, so a qualifying buyer keeps that billing arrangement for the remainder of the 20-year period.
Schedule Your Home Inspection
Solar is one piece of the picture. Whether you're buying a home with an existing system or just want a thorough, objective look at everything else, schedule your inspection with Cedrus Property Inspections today.
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