See the true 25-year cost of leasing versus owning your solar panels — including the home-value difference most sales reps skip over, updated for 2026 (no homeowner tax credit).
SCReviewed by Sarah Chen, Energy AnalystUpdated October 1, 2026Sources: DSIRE, NREL, IRS
Owned solar captures a ~4.1% home-value increase and all the bill savings — both largely forfeited under a lease or PPA. Photo: American Public Power Association / Unsplash
Updated October 2026 — federal credits have ended. The One Big Beautiful Bill Act (signed July 4, 2025) ended the 30% federal Residential Clean Energy Credit (25D: solar, batteries, geothermal) and the Energy Efficient Home Improvement Credit (25C: air-source heat pumps, up to $2,000) for anything installed after December 31, 2025. Systems completed by Dec 31, 2025 can still be claimed on a 2025 return. Any 30% or $2,000 figure on this page applies only to those installs — our calculators now default to $0 federal credit. What is still available in 2026 →
Quick answerOwning solar beats leasing for most homeowners. A $21,000 system costs $21,000 to buy in 2026 (the 30% credit ended after 2025), while a $105/month lease escalating 2.9% a year can exceed $45,000 over 25 years — plus owners capture a ~$15,000 home-value increase that leasers forfeit.
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Compare lease vs buy
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$
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Most leases raise your payment 2.5–3.5% every year.
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Zillow: owned solar adds ~4.1% to home value; leases add little.
Owning saves you
$39k
over 25 years vs leasing
Buy (net)
$21,000
Lease (25 yr)
$45,340
+ Home value
$15,000
Buy (net) includes no federal credit, which ended for installs after Dec 31, 2025. Leasing forfeits most of the home-value gain. Savings = lease total + home-value gap − net buy cost.
How this calculator works
1
Enter the cash price
What the system costs to buy outright.
2
Enter the lease payment
Starting monthly lease/PPA payment and its annual escalator.
3
Add the home-value gain
Owned solar adds ~4.1% to home value; leases add little.
4
See the 25-year gap
We total both paths and show how much owning saves.
Lease vs buy: the honest comparison
A solar lease (or PPA) sounds great in the sales pitch: $0 down, instant savings, someone else maintains the panels. The catch shows up over 25 years. Because the leasing company keeps any tax credit it can claim (in 2026, the commercial Section 48E credit), keeps any state incentives, and charges you an escalating monthly payment, the lifetime cost of leasing is usually far higher than owning — often $30,000–$50,000 versus about $21,000 to buy the same system outright in 2026.
Ownership also captures the home-value increase. Zillow research found homes with owned solar sell for about 4.1% more, while leased systems add little and can actually slow a sale because buyers must qualify to assume the lease.
When does a lease make sense?
The leasing company passes through a real share of its Section 48E credit as a low, flat payment (that credit requires construction to begin by July 4, 2026 or service by the end of 2027).
You can't or don't want to finance a purchase, even at a low rate.
You value zero maintenance responsibility over lifetime savings.
For nearly everyone else, owning — with cash or a solar loan — wins clearly. Run the full four-way comparison in the Financing Calculator.
Questions
Frequently asked questions
Is it better to lease or buy solar panels?
For most homeowners, buying is still better. Owning captures the ~4.1% home-value increase and avoids an escalating monthly payment. For a 2026 install there is no 30% federal tax credit, so a typical system costs about $21,000 to own, while leasing can exceed $40,000 over 25 years. Leasing makes sense mainly if you can't finance a purchase, or if the leasing company passes through a meaningful share of the commercial Section 48E credit it can still claim.
Why do solar leases cost more over time?
Three reasons: the leasing company keeps any tax credit it claims (in 2026 that can be the commercial Section 48E credit), they keep state incentives, and your payment escalates 2.5–3.5% every year for 20–25 years. Those escalating payments compound into a much larger lifetime cost than a one-time purchase.
Does a leased solar system hurt home resale?
It can. A buyer must qualify to assume the remaining lease, which narrows your pool of buyers and can delay closing. Owned solar does the opposite — it transfers cleanly and adds measurable resale value, so it's reflected in a higher sale price.
Can I buy out my solar lease later?
Usually yes, but the buyout price is set by the leasing company and is often higher than the system's depreciated value. Read your contract's buyout schedule before signing. Many homeowners who lease later regret not financing a purchase instead.
Does anyone get a tax credit on a leased system in 2026?
Not you. Homeowners lost the 30% Residential Clean Energy Credit for systems installed after December 31, 2025, whether they buy or lease. The leasing or PPA company, as the system owner, may still claim the commercial Section 48E credit if construction begins by July 4, 2026 or the system is placed in service by the end of 2027. Ask how much of that is reflected in your lease rate.
Sarah has spent 12 years modeling US residential solar economics, including 4 years contributing to NREL's Distributed Generation Market Demand model. She holds a BS in Mechanical Engineering from UC Berkeley and reviews every calculator and state guide on GreenCalcs against current IRS, DSIRE and EIA data. Read our methodology →
