With the Intergovernmental Panel on Climate Change (IPCC)’s latest climate change assessment reporting of a world at crisis point, the recent global fuel crisis, and the upcoming Climate Change Conference (COP26), people are now looking at their carbon footprint and wondering what they can do to make a difference. For many this means looking a lot closer to home; especially at a time when energy prices are at an all-time high.
The Government intends to update energy efficient standards on properties which will apply not only to newbuild properties but also existing properties. Existing properties will be subject to higher standards when undertaking such works as extensions and other home improvements. The Government’s intention is for such measures to be introduced by 2025 with a view to achieving net-zero emissions by 2050.
In support of greener and more sustainable homes, we are seeing some lenders offering a “green” cashback incentive ranging from £250.00 - £500.00 for properties with an energy efficiency rating of A and B; both new build and existing properties. This could be in addition to other cashback incentives that lenders provide and will supply a large incentive to buyers considering more energy efficient homes.
Whilst Government reform in this area is necessary, it’s worth bearing in mind that this will likely have cost and time implications for developers building new properties. These costs may be passed on to purchasers and any individuals wishing to improve their home may find an impact on affordability.
To summarise, measures taken to meet energy efficiency targets may:-
- increase costs for developers, who will inevitably pass this on to buyers thereby potentially increasing new build house prices;
- impact the time it takes for developers to be able to construct properties, undertake relevant training, and ultimately supply the country’s housing demand; and
- discourage/prevent people being able to extend or undertake works to improve the energy efficiency of an existing property due to increased costs.
Improving the energy performance of buildings is vital to achieving net-zero emissions by 2050 and protecting the environment for future generations to come.