A government plan to make solar panels compulsory on all new homes has been branded a “well-meaning mess”.
Industry experts are warning that it could backfire on homeowners – adding to mortgage bills, complicating sales and pushing up legal costs.
Energy Secretary Ed Miliband is championing the policy as a key plank of Labour’s green agenda.
But mortgage brokers, conveyancers and developers have warned it could make selling or remortgaging a home “mission impossible”, particularly if the solar panels are leased rather than owned outright.
Ranald Mitchell, director at Charwin Mortgages, warned that while the plan may sound like a “green win,” there’s a major catch.
He said: “From a mortgage perspective, rented panels and the airspace leases that come with them often create serious complications.
“These agreements typically include title restrictions on disposition, meaning you may need the solar provider’s permission just to sell or remortgage your home.
“That’s a red flag for many lenders, some of whom flat-out refuse to lend on properties with such arrangements… Unless the lease can be adopted by the new buyer on identical terms, selling the home can quickly become mission impossible.”
The concerns centre on how lenders treat third-party-owned solar panels, which are often accompanied by long-term leases that limit a homeowner’s control over their property. Experts say this creates uncertainty for buyers and legal pitfalls that delay transactions.
Chris Barry, director at Thomas Legal, told Newspage the proposal would add a layer of complexity “no one needed”.
“Lawyers typically raise around five additional enquiries when a property includes solar panels, and that additional work usually comes at an extra cost,” he said.
“The theory around solar panels on new builds may be great but the practice is slightly trickier.”
Mortgage broker Justin Moy, of EHF Mortgages, said the extra costs could quickly outweigh any energy savings.
“Saving £500 a year will easily be wiped out with higher mortgage rates and additional fees for upkeep, maintenance and legal checks,” he warned.
Harry Goodliffe, director at HTG Mortgages, described the scheme as “a classic case of good idea, bad execution”.
He said: “If solar panels are leased or third-party owned, it can cause chaos with lenders and slow everything down – more legal costs, more hoops to jump through, and potentially higher mortgage rates if lenders treat these homes as higher risk. »
Property developer Kundan Bhaduri, of The Kushman Group, went further, branding the plan “another Miliband masterstroke that manages to punish both builders and buyers in one solar-powered swoop.”
“Lenders already treat properties with leased solar panels with deep suspicion,” he said.
“Add the burden of proving maintenance plans and ownership rights, and buyers are left wondering if saving fifty pounds a month on electricity is worth thousands in headaches.”
David Stirling, director at Mint Mortgages & Protection, said the move was “a great green initiative in theory, but potentially major complications in reality.”
He warned: “There needs to be more guidance and standardisation in place, to ensure the good doesn’t become the bad.”
Ed Miliband insisted the plan will save homebuyers a fortune on their energy bills.
He said: “Solar panels can save people hundreds of pounds off their energy bills, so it is just common sense for new homes to have them fitted as standard.
« So many people just don’t understand why this doesn’t already happen. With our plans, it will.”
