How energy credits could impact the future of the property market

Plans to make the UK a world leader in green energy requires an understanding of how energy credits could impact the future of the property market.

Those plans to make the UK a world leader in green energy have been steadily increasing in the past few years. With energy efficiency taking a lead role in the push for cleaner sources of power, it’s essential to understand the effects of these changes on the UK property market.

The legal requirement to have a valid Energy Performance Certificate (EPC) when a building is constructed, rented or sold will affect homebuilders and the individuals who live in these dwellings.

Improving the energy efficiency of each home in the UK will provide a significant opportunity for workers and companies focused on supplying a solution to this challenge, including conveyancers.

Producing an EPC

To produce an EPC, an approved Domestic Energy Assessor must evaluate a property. They determine the energy efficiency of a building and estimate the related energy costs. Implementing the EPC’s recommendations will increase the energy efficiency of the dwelling.

Purchasing a home with lower energy costs will be an incentive for buyers.

Retrofitting the existing housing sector

The goal of retrofitting about 10 million owner-occupied homes in the UK by 2035 may seem like plenty of time to get the task done, but this deadline will come quickly due to the pending requirements.

Upgrading the energy efficiency of these homes to achieve A, B and C ratings is required to decarbonize each home so that it meets the standards of low carbon heating, such as using heat pumps as they use renewable heat from the environment.

Roughly three million private rented sector landlords also need to upgrade their homes to meet the government’s energy efficiency requirements in its aspirations for a greener climate and net-zero carbon emissions.

Potential gains from energy savings

Data from areas in the UK where home prices are lower compared to higher-priced regions indicates that adopting the energy efficiency measures proposed will increase a home’s value.

Decarbonizing existing homes also offers an opportunity to provide an increase in activity to the construction industry as well as ancillary industries involved in this process.

Challenges with current housing energy efficiency

In 2018, nearly 50 percent of dwellings had solid wall or cavity insulation and close to 40 percent had loft insulation. Energy improvements such as these are easier to implement as they create a lower level of disruption.

However, deeper retrofits are required if the goals for energy efficiency in the UK are going to be met. Another challenge is that many homeowners are unaware of the current energy efficiency goals for the UK. These owners will likely require advice on retrofitting and upgrading their homes to meet the standards required to meet the government’s goals.