Buying a Home with a Propane Tank in Massachusetts? What to Know

If you're buying a home in Massachusetts with a propane tank on the property, there's one question you may not think to ask:

Does that tank actually belong to the seller?

This came up recently during one of our Santana Team meetings when agent Katrina Boschetti raised an important point from her experience with propane-served properties: the propane tank may actually be leased from the propane supplier rather than owned by the homeowner.

It's a small detail that can create an unexpected question, or an unexpected cost, right around closing.

Here's what buyers should know before purchasing a Massachusetts home with propane.

First: Is the Propane Tank Owned or Leased?

A propane tank on the property doesn't necessarily belong to the homeowner.

The Massachusetts Attorney General's Office advises consumers that, in some cases, the propane dealer owns the tank and the homeowner rents it. Tank ownership becomes particularly important if you eventually want to switch propane suppliers.

So one of the first questions a buyer or buyer's agent should ask is simple:

Who owns the propane tank?

If the seller owns it, confirm that the tank is included with the property.

If a propane company owns it, find out:

• Which company owns the tank
• Whether there is a lease or service agreement
• What fees are associated with the agreement
• What happens to the agreement when the home is sold
• Whether purchasing the tank is an option
• What happens if you eventually want to use another propane supplier

The goal is to understand the arrangement before you own the house, not when you need your first propane delivery.

Owned vs. Leased Propane Tanks

The exact terms depend on the tank, supplier and property, which is why reviewing the existing paperwork matters.

What Happens to the Propane at Closing?

The tank and the propane inside it are two different issues.

Similar to a home with heating oil, the remaining fuel may need to be measured near closing so the parties can account for its value.

That means a buyer could have a propane-related adjustment at closing even when the propane company owns the actual tank.

The process can vary by supplier and property, so the agents and closing attorney should confirm how the remaining propane will be handled before closing.

It's one of those relatively small details that's considerably more annoying when everyone discovers it three days before the closing.

Where Might Massachusetts Buyers Encounter Propane?

Propane isn't the predominant heating fuel in Massachusetts, but buyers may encounter it when looking at single-family homes in lower-density suburban communities, particularly at properties without access to utility natural gas.

Around Greater Boston, our team encounters propane systems in markets including Burlington, Bedford, Lexington, Carlisle, Concord, Lincoln, Sudbury, Wayland and Weston.

That doesn't mean propane is common in every part of these communities or that it's necessarily the home's primary heating fuel. A property may use propane for only one or two systems.

Propane can potentially serve:

• Heating
• Hot water
• A cooking range
• A fireplace
• A clothes dryer
• A standby generator
• Pool equipment
• Other gas appliances

So when you learn that a property has propane, the next question should be: What does it actually serve?

What If You Don't See a Propane Tank?

Not seeing a large propane tank beside the house doesn't necessarily mean there isn't one.

On properties using propane for whole-house heating, the tank may be buried underground. From the yard, you may see only a relatively small access dome or cover that provides access to the tank's valves, gauge and fill connection.

Other properties may use multiple above-ground tanks to provide the necessary capacity.

This is another reason buyers shouldn't rely solely on what they can see during a showing. Ask where the propane tank or tanks are located, what they serve, who owns them and what their capacity is.

For an underground tank, buyers should also ask whether the seller or propane supplier has maintenance, inspection or testing records. Buried metal propane tanks require protection against corrosion, so understanding the tank's ownership and maintenance history is particularly important.

Can You Buy a Leased Propane Tank?

Sometimes, but don't assume you can.

Some propane suppliers may give homeowners an option to purchase a supplier-owned tank. Others may structure their equipment and service differently.

If purchasing the tank is possible, find out:

• The purchase price
• Whether there are additional fees
• What maintenance becomes the homeowner's responsibility
• Whether ownership changes your ability to purchase propane from other suppliers

Owning the tank may provide more flexibility, but that doesn't automatically mean buying it is the best choice. The important thing is understanding your options and the costs attached to them.

What If You Want to Switch Propane Companies?

This is where tank ownership becomes especially important.

If the propane company owns the tank, switching suppliers isn't necessarily as simple as calling another company and asking them to fill it.

Massachusetts regulates propane storage and installations under the Massachusetts Comprehensive Fire Safety Code, and local fire departments oversee permitting requirements. Depending on what needs to happen at the property, permits may be required if a tank is installed, replaced or modified. Some municipalities may also have requirements associated with changing propane vendors.

Before changing suppliers, homeowners should ask both the prospective propane company and the local fire department what is required for that particular property.

Questions to Ask Before Buying a Home With Propane

If we're helping a buyer purchase a propane-served property, these are the details we want to understand before closing:

Who owns the tank?

Confirm whether it belongs to the seller or the propane supplier.

Who is the current supplier?

Get the company's name and contact information.

Is there a lease or service agreement?

Ask for the terms rather than assuming the existing arrangement automatically transfers.

What does the propane serve?

Determine whether it's the primary heating fuel or serves only certain appliances.

Where is the tank?

Confirm whether it's above ground or underground and whether the property has more than one tank.

What has the property's propane usage been?

Past usage can provide useful context, although future consumption will depend on the household, weather, equipment and other factors.

How will the remaining fuel be handled at closing?

Confirm the process with the agents and closing attorney.

Can the tank be purchased?

If it's supplier-owned and you're interested in owning it, ask whether that's an option and what it would cost.

What happens if you want to change suppliers?

Tank ownership and local requirements can affect your options.

A Small Property Detail Worth Catching Early

This article actually started with a conversation during our weekly Santana Team meeting.

Santana Team agent Katrina Boschetti raised the propane-tank issue after seeing how easily tank ownership and the final fuel reading can get overlooked in a home purchase. Sharing it with the team meant our other agents could watch for the same issue with their buyers.

That's one of the advantages of working with a full real estate team. Greater Boston homes come with an astonishing variety of systems, local requirements and property-specific quirks. An agent may encounter something at one property that helps another agent better advise a buyer at the next.

The Santana Team has helped more than 1,600 clients, and our agents and support team regularly share what we're seeing so that experience doesn't stay with just one person.

Buying a Home in Burlington, Bedford, Lexington or Greater Boston?

If you're considering a home with propane, oil heat, a private septic system, a well or another feature you haven't dealt with before, having an agent who knows what questions to ask can help you identify important details before closing.

Katrina Boschetti works with buyers throughout Greater Boston, including Burlington, Bedford, Lexington and the surrounding communities. Connect with Katrina to talk about your home search and what to look for as you evaluate individual properties.

Connect With Katrina

Information about propane suppliers, permits, energy costs and municipal requirements can change over time. Buyers should verify current requirements for the specific property, supplier and municipality.