How can investors meet the rising demand for sustainable homes?

11 December 2020 | Investment

With some 20% of the UK’s carbon emissions coming from domestic buildings, the importance of sustainable construction has become undeniable. Over the years, the property industry has taken vital steps to implement sustainable solutions into their projects, whilst the government continues to introduce supporting strategies.

The recently introduced Green Homes Grant has proven to be a very popular initiative amongst property owners. The latest poll from Nationwide, which was published in September, shows that 41% of interviewees want to improve their homes’ energy efficiency and reduce their carbon footprint.

It comes as no surprise that consumers have been calling for the Green Homes Grant deadline of March 2021 31 to be extended. Their wishes were granted as Boris Johnson announced that the Green Homes Grant will be extended for another year. This means that vouchers will remain valid for three months from the date they were issued or until March 31 2022 – whichever is earlier – and need to be redeemed before the end date on each one.

The government’s recent introduction of a £4 billion investment plan to create a Green Industrial Revolution also increases the momentum towards sustainable housing solutions. Solar panels, ground source heating and batteries are also starting to reach production economies of scale and become economically viable, leading to the emergence of exciting new possibilities.

With an ever-growing public desire to be living in a sustainable home, property investors need to be aware that properties with good eco-credentials are likely to attract higher interest from tenants and house hunters. The market is starting to see a long-overdue increase in the number of eco-friendly homes, driven by developers who are putting emphasis on sustainability in response to the government’s Future Home Standard.

To quote the UK government: “The UK has set in law a target to bring all its greenhouse gas emissions to net zero by 2050 – one of the most ambitious targets in the world. Homes – both new and existing – account for 20% of emissions. Despite progress reducing emissions from homes, we need to go much further. New homes being built now and in the next 5-10 years will still exist in 2050 and therefore we must ensure that the energy efficiency standards we set for them put us on track to meet the 2050 target. We expect that an average home built will have 75- 80% fewer carbon emissions than one built to current energy efficiency requirements.”

Bearing in mind that the buy-to-let and the wider property investment markets are becoming increasingly competitive, landlords and investors may wish to consider giving their property portfolio a much-needed eco-boost. Here are our top tips:

Review your heating system

Old-fashioned heating systems will send your property’s utility bills rocketing and have a high carbon footprint. To reduce both, consider installing a Ground Source Heat Pump. This is a highly efficient, renewable energy source that has a low environmental impact and reduces carbon output by as much as 70%.

Modular construction

Modular construction is starting to gain traction and become more cost competitive, with an increasing number of developers using the latest off-site manufacturing techniques to build their projects. It offers a high level of quality assurance and construction speed that traditional construction techniques can’t keep up with. Most importantly, the off-site preparation of modules has immense environmental benefits.

According to the Building Research Establishment, UK construction industry’s average material wastage on site is 13%. Modular construction can reduce this significantly as all off-cuts are fully recycled in the factory. This also reduces landfill by at least 70%. Noise and other sources of disturbance are also minimised.

Insulation

Poor insulation can have a significant impact on your property’s EPC rating. Luckily, there are a number of solutions available that can help you fix this. Do bear in mind, however, that there is a wide variety of insulation materials available. Each offers different benefits and suits different budgets. If you’re looking for something affordable that, at the same time, is environmentally friendly, you might want to consider cellulose insulation. This material is particularly well suited to insulation of floors, walls and roofs.

Windows

An obvious detail to review when trying to improve your property’s energy efficiency is windows. The performance of windows is measured by something called a U value, which reflects the thermal transmittance, e.g. the transfer rate of heat through matter. The lower the U value, the better. Building Regulations now insist that any window you install nowadays should have a U value no worse than 1.6.

Single glazed windows normally have a U value of around 5. Double-glazed windows can range from 1.2 to over 3 depending on coatings and frames; certain makes such as Velfac can achieve as low as 1.4. On the other side of the spectrum, the Passivhaus standard requires triple glazed windows with a U value of no more than 0.8.

Here, at MELT Property, we pride ourselves on creating design-led, sustainable projects. With global warming being a significant concern for current and future generations, we believe that developers have a responsibility to deliver schemes that have a positive impact on the environment.

Our most recent project is Lime Grove, a stunning new development in Gloucestershire that features 12 family homes and 7 flats. Lime Grove is already incorporating the government’s Future Homes Standard 2025, which asks for new homes to be built without gas boilers.

When we opened our show home earlier this month, we registered a particularly high interest from buyers who are looking for a home that is highly sustainable and has an above average EPC rating. This strong consumer awareness is a clear indication that the trend for sustainable homes is only just beginning. We are entering a new era of properties that work with and not against the environment.

For more information about MELT Property, please visit www.meltproperty.co.uk

*Evan Maindonald was born in New Zealand. He has lived in the UK since 1992 and has been involved full time in property development and investment since 2002. MELT Property is a group of property development and investment companies which was originally formed in the same year.

This post has originally been featured in Property Investor Today.