‘Lagging behind – energy efficiency in low viability properties’, a report released on 21 October, raises concerns over the affordability of retrofitting properties.
We urge the UK Government to give serious consideration to the impact of regional variability in house prices and dwelling stock when installing heat pumps to hit decarbonisation targets.
Failure to factor in huge regional variations in property prices when incentivising homeowners and landlords to retrofit their properties to meet national net zero targets could risk seeing a reduction in the quality and availability of housing stock.
According to the report, in some local authority areas of the north and midlands, the estimated costs of improving home energy can be around 25 per cent of property values, while in affluent parts of London and the south east retrofitting with heat pumps represents less than 2 per cent of overall property value.
For example, in the red wall constituency of Burnley, where nearly four-in-five dwellings need to attain EPC Grade C standards, standard retrofitting costs of £24,000 are equivalent to a quarter of median house prices of £99,500. However, in the Royal London Borough of Kensington and Chelsea, where median house prices are £1,317,500, retrofitting costs are equivalent to a mere 1.8 per cent of overall property values.
The UK Government announced their ‘Build Back Better’ initiative in 2020, however, the policy presents problems for the private rented sector where properties are of low value, landlords are unlikely to have either the rental income or equity to finance upgrades. Furthermore, homeowners in such areas on low income have no incentive to fund expensive improvements that add no value to the property.
The Report was dissected and discussed by a panel of guests including Roz Bulleid, Deputy Policy Director, Green Alliance, Cllr David Simmonds MP, Chairman, All Party Parliamentary Group on Housing and Planning, Erin Walsh, Director of Built Environment, Connected Places Catapult.
Two prominent themes arose, which are – behavioural change and consumer choice and awareness. Targets based on property type, not tenure were also cited.
The Heating and Building Strategy aims to help homeowners make the transition to low carbon heating, however, in order to properly address the retrofit challenge it must:
Other report recommendations include calls for:
Article Abridged, by Propertymark