We already know that homes with better energy efficiency credentials are becoming more sought after, but it seems that the shift in people’s attitudes could be more permanent than first thought.
Environmental issues are certainly closer to the forefront of our minds and the way we live our lives than they were a decade ago, led by new research alongside the government getting on board with its targets to drastically reduce the country’s carbon emissions.
Yet energy efficiency has been cast into the spotlight on an even greater, more personal scale since the full extent of the rising energy costs began to be felt across millions of households during the latter part of 2022, and it is this that has spurred an even greater interest in a more eco-friendly way of living.
This rising trend has been confirmed in a new survey conducted by Knight Frank, which has discovered that the energy efficiency of a property is now “central” to a buyer’s decision-making process as a direct result of soaring utility bills.
What’s more, Knight Frank believes that, even as wholesale energy prices begin to retreat, which is expected to happen later in 2023, this new mindset will become a permanent fixture as buyers look to improve the longevity and resaleability of their investments.
Energy efficiency stands out for buyers
From owning an electric vehicle to making even small lifestyle changes such as increasing your household’s recycling and buying products with less packaging, many of us are adapting to a world where we try to consume and waste less.
As mentioned, while this was previously more driven by environmental reasons, Knight Frank’s survey found that 35% said rising energy bills were the biggest influence when purchasing a home with a higher energy efficiency rating.
What’s more, over three quarters (76%) of respondents said that they now rate a domestic electric vehicle charging point as more or equally important than it was a year ago. This coincides with the huge increase in electric cars on our roads, alongside new rules for new-build properties having charging point provision installed.
The latest data shows that average winter utility bills will have almost doubled this winter compared to last winter, despite the price cap imposed by the government, so it’s no surprise that this is now a priority for property hunters.
The same can be said for buy-to-let landlords, who are more likely to entice tenants if they can prove the energy efficiency of their rental home.
Other benefits of greener homes
Knight Frank’s survey also found that 20% of people would be influenced to buy a more energy efficient property due to the “prospect of future regulations impacting the value of my home”.
The government would like all homes to achieve an energy performance certificate (EPC) rating of C or above by 2035, through upgrades and retrofitting as well as through building properties with higher standards of energy efficiency. More than half of properties are currently rated D or below.
In the private rented sector, there are already regulatory requirements to bring the energy efficiency of your home up to an EPC rating of E or higher, and this bar is widely expected to be raised within the next couple of years. This means top-rated properties in the buy-to-let space are already more sought after.
A further 18% of those surveyed said they would just prefer to own a greener home when asked what would influence them to buy an energy efficient property, and they said they would be willing to pay more for it.
Chris Druce, senior research analyst at Knight Frank, commented: “While environmental concerns are a consideration for many home buyers, it is the record-breaking cost of energy that is dominating most buyers’ thinking at present.
“Although wholesale energy prices are expected to fall back later this year, it is unlikely that buyers’ mindsets will change quickly.”
If energy efficiency is a priority for your next property investment, get in touch today to find out about our new-build and newly renovated projects and opportunities across the UK.
