Eco sustainability property

Improvements made in EPC ratings for housing but more progress needed

In the past 10 years, there have been improvements to the EPC ratings of residential properties in England. However, more progress is necessary to meet the government’s net zero target by 2050.

The English Housing Survey for 2019-20 reveals the energy efficiency of homes in England has improved over the past decade. Above all, the proportion of homes in the highest EPC bands of A to C grew sat at 12% in 2009. In 2019, that figure reached 40%.

In the private rented sector, 38% of homes were in bands A to C in 2019. This is up from 13% in 2009 and is 2% higher than the amount of owner-occupied homes. There are proposals for all new tenancies to have an EPC rating of C or better by 2025.

Out of all houses in England, only 3% of dwellings are now in bands F and G. In 2019, this figure was 12%. The survey revealed 40% of homes are already in band C or above. And 57% of homes could be improved to this level. For example, over two-thirds of homes with a rating of D or below could be brought to band C for less than £10,000.

Timothy Douglas, policy and campaigns manager at Propertymark, comments: “The latest English Housing Survey confirms that a long term, costed and well-funded plan is desperately needed to encourage households and landlords to make energy efficiency improvements to their properties and meet UK Government targets.”

More progress needed

The average cost to improve homes to band C is £8,100. For owner-occupied dwellings, this costs an average of £8,579. While for private rental properties, this costs an average of £7,646.

Vouchers through the Green Homes Grant provided up to £5,000 towards energy efficiency upgrades in most cases. Originally launched in September 2020, the scheme received 113,700 applications. However, only 10,300 measures were installed, according to the Department for Business, Energy & Industrial Strategy. Additionally, only 6,700 homes received money through the scheme.

The government has set a target to reach net zero greenhouse gas emissions by 2050. In order to do this, the UK’s housing stock needs significant energy reductions across the board. Many feel landlords and homeowners should be provided incentives and access to funding. This could help reduce emissions across the property sector.

“It also clearly highlights that the Green Homes Grant scheme wasn’t offering enough support based on the proposals to improve property to EPC Band C and any revised or reintroduced scheme must be increased from £5,000 to £10,000 maximum,” Timothy Douglas states.

“Similarly, it is vital that the UK Government move away from a one-size fits all policy and develop energy efficiency proposals that work with the different age, condition, size and location of properties across the country. This way grants and funding support can be targeted on the architype of a property rather than its tenure.”

The rise of green mortgages

In recent months, a number of new green mortgages have come to the market. Green mortgages offer better rates directly linked to the EPC rating of properties. Usually, the better the rating the better the discount.

This is encouraging more landlords to invest in the energy efficiency of their properties. This is either by improving their property’s EPC rating or by investing in new-builds with higher energy efficiency. At the same time, energy efficiency has become a top priority for buy-to-let investors. This is right alongside rental yields and opportunity for capital growth.

Green mortgages will likely become the norm in the lending sector moving forward. And buying and investing in greener properties will gain further steam in the coming years.

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