Eco-friendly investment could attract more millennials to your property sustainability

Sustainability in property: 5.7% of new-build flats are now “net zero”

There continues to be a heightened interest in sustainability within the UK’s housing industry, and standards are continuing to improve in the new-build sector. 

The energy efficiency and sustainability credentials of today’s new-build homes has risen considerably over the past decade or more, as measured by the average energy consumption of a typical property, according to the latest data from Knight Frank.

The agency’s analysis found that the average energy consumption of a newly built home has reduced from 120 kilowatts per hour, per metre squared, per year in 2009, to just 80kWh/m2/year. This is thanks to the construction industry’s ongoing focus on improving standards and efficiency across new homes.

Properties that achieve the “net zero” threshold have also seen a healthy increase in quantity between 2009 and now; back then, only 0.1% of both houses and flats achieved the net zero status, while research from 2022 shows that 4% of houses and 5.7% of flats are now essentially carbon neutral.

To meet this measure of sustainability, a property must consume no more than 35kWh/m2/year.

The value of sustainability

From both a homeownership and a property investment perspective, sustainability has become a more key consideration than ever over recent years. In part, this is due to the government’s net zero agenda, as well as a wider recognition of environmental issues in the mainstream media.

As far as the property industry is concerned, the rise in energy bills has also contributed vastly to people’s interest in the sustainability and energy efficiency of their homes. This goes for homeowners as well as property investors, who are looking for the most marketable qualities to attract the best tenants.

Knight Frank’s research points out the actual monetary value that sustainability in property can bring, too. Net zero homes can bring an average price premium of 3.8% in sales value compared to a standard new-build – although separate studies indicate that the enhanced energy efficiency of the wider new-built market is still appealing.

Past research by the agency has found that a higher energy performance certificate (EPC) rating can increase a property’s value by as much as 20%. A separate survey by Knight Frank found that 72% of people rate a home’s energy efficiency as more important than before the Ukraine conflict.

More knowledge and awareness

It is safe to say that both knowledge and awareness of sustainability issues and energy consumption in the housing market has increased significantly, among both consumers and on the commercial side. Knight Frank points out, though, that more change will only happen if driven by consumers.

Its report notes that there has been a rise in ‘ESG-related’ terms – those linked to environmental, social, and corporate governance – across the marketing language for homes for sale across prime central London.

The proportion of listings that use these terms has more than doubled over the past 10 years, from 14% to 34%. This includes property listings that mention things such as electric vehicle/EV, as well as other terms linked to the sustainability of a property.

Top 10 sustainable features

There are numerous factors that property buyers and investors can focus on in order to boost the sustainability of their properties, and help to make their investment more future-proof as attitudes continue to change.

Research from Hive published earlier this year listed the top 10 sustainable features or upgrades to make a home more appealing – and this can apply to those trying to sell or those looking to rent out their property and fulfil the needs of their tenants:

  1. Solar panels
  2. Good roof insulation
  3. Good thermal wall insulation
  4. Smart heating system
  5. Energy efficient lighting
  6. Smart lighting
  7. Triple-glazed windows
  8. Good natural lighting
  9. Energy efficient fridge
  10. Energy smart meter

According to Hive’s survey, more than half of people (55%) think making our homes sustainable is something everyone needs to think about, and 47% have already proactively made changes to their property to make it greener and more sustainable.

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