There are two fundamentally different ways to get solar on your roof: buy the system (with cash or a loan), or let a third party own it while you pay them monthly (a lease or PPA). Same sunlight — very different deals. Here is how they compare, without the sales pitch.
The Core Difference: Ownership
Buying means the system is yours. You pay for it with cash or a solar loan, and the panels, the energy savings, and the equipment warranties belong to you.
Leasing (or a PPA) means a third-party company owns the system on your roof. You pay them a fixed monthly amount (lease) or a per-kilowatt-hour rate (PPA) — in exchange for little or no upfront cost and no maintenance responsibility.
Everything else — costs, maintenance, taxes, and home sales — flows from who owns the system.
Cost Structure
With buying, the biggest number is up front: the full installed price (or the loan that covers it). After that, your electricity savings are fully yours — there is no third party taking a margin between the system's production and your bill.
With leasing or a PPA, the biggest number is ongoing: a monthly payment that typically rises slightly each year (check the escalation clause). The appeal is immediate: no large upfront payment, and your combined bill — lease payment plus remaining utility bill — is usually designed to be lower than your old electric bill. Over a 20- or 25-year term, though, the provider's margin means the total paid is generally higher than the system's purchase price.
Maintenance Responsibility
With buying, maintenance is yours — though in practice there is little to do. Panels have no moving parts, and equipment warranties cover defects. If an inverter fails years down the line, you (or the warranty) handle it.
With leasing or a PPA, the owning company handles monitoring, maintenance, and repairs for the life of the agreement. If something breaks, you call them. This is genuinely valuable for homeowners who do not want another thing to manage — just know it is priced into your payments.
Selling Your Home
An owned system simply conveys with the house — it is part of the property, like the roof itself. If you have a solar loan, the remaining balance is typically paid off at closing or assumed by the buyer, per the loan terms.
A leased system or PPA requires the agreement to be transferred to the buyer or bought out. In practice, transfers usually go through, but they add a step to the sale: the buyer must qualify and agree, and some buyers are wary of taking on a long-term contract they did not negotiate. Read the transfer and buyout clauses before you sign — they matter years later.
The Tax-Credit Distinction
Here is where the 2026 landscape makes the choice sharper:
- The federal Residential Clean Energy Credit (Section 25D) expired for homeowner-owned systems placed in service after December 31, 2025 — so buying in 2026 comes with no direct federal credit unless Congress acts.
- Third-party-owned systems under leases and PPAs may still qualify under Section 48E through 2027 — the owning company claims the credit, which is one reason those offers remain competitive.
Full details are on our federal tax credit page, and as always, consult a tax professional — this is general information, not tax advice.
Side-by-Side Comparison
| Buying | Leasing / PPA | |
|---|---|---|
| System owner | You | Third-party company |
| Upfront cost | Full price (or loan down payment) | Little to none |
| Ongoing payments | Loan payments until paid off, then none | Monthly payment for the full term |
| Who maintains it | You (warranties apply) | The owning company |
| 2026 federal credit | None for homeowner-owned installs | Owner may claim 48E through 2027 |
| Selling the home | Conveys with the property | Agreement transferred or bought out |
| Best fit when… | You want full control and maximum lifetime savings | You want low upfront cost and zero maintenance |
No push, just perspective. Buying tends to deliver the best lifetime value if you can handle the upfront cost or a loan payment. Leasing and PPAs remove the barriers — no big check, no maintenance — at the price of long-term payments and a third party owning your roof's power plant. The right answer depends on your finances, your timeline in the home, and how much of the system you want to manage.
Frequently Asked Questions
The homeowner Residential Clean Energy Credit (Section 25D) expired for systems placed in service after December 31, 2025, so a purchased residential system in 2026 carries no direct federal credit unless Congress enacts new legislation. Third-party-owned systems under leases and PPAs may still qualify under Section 48E through 2027. Talk to a tax professional about your specific situation.
Outcomes vary. Some buyers like inheriting lower electric bills; others are hesitant to assume a long-term contract they did not negotiate. A leased system adds a transfer step to the sale that an owned system does not. Disclose the agreement early in the listing process so buyers can review it with time to spare.
Most agreements include buyout terms, but the price and timing are set by the contract — sometimes a fixed schedule, sometimes a fair-market-value calculation. If you think you might want out early, read the buyout clause before signing, not after.
With an owned system, you do — with manufacturer and workmanship warranties as your safety net. With a lease or PPA, the owning company handles repairs and monitoring for the life of the agreement; you just report the problem. Ask any provider how quickly they respond to service calls before you commit.