10:12 AM, 9th November 2022, About 11 months ago 3
Home buyers are spending an average of 15.5% more for an energy-efficient property, research reveals.
The findings from Santander show that four in five estate agents (79%) are predicting a big rise in buyers wanting homes with an Energy Performance Certificate (EPC) rating of C or above.
And nearly three-quarters (70%) of agents have seen homeowners struggle to sell their property if it has poor energy efficiency – and 79% of agents predict this to rise in the next 12 months.
This could be an issue for landlords who are thinking about selling up before the expected tightening of EPC regulations in 2025 when rented homes will need to meet the minimum rating of C.
Researchers also found that due to shifting demand, three-quarters (74%) of estate agents have changed the property’s price based on the EPC rating and say it takes three months longer to sell a home with a low EPC rating.
Santander’s Buying into the Green Homes Revolution report has found estate agents will play an important part in increasing awareness and understanding among buyers of home energy efficiency, as demand for green homes increases.
Researchers asked 2,000 homeowners and 175 estate agents their views on retrofitting and found there is a distinct growing interest among home buyers for energy-efficient properties, with 85% of estate agents reporting increased demand in the past twelve months.
Estate agents put this down to the rising costs of energy bills (54%), alongside an increased number of green mortgage products from lenders (45%) and a greater awareness of the need to live more sustainably to combat climate change (51%).
Not only is there growing awareness but estate agents report this is creating a ‘green premium’ in the market, with buyers spending on average 15.5% more for a property with a high EPC rating.
But while homeowner engagement is growing, there remains a knowledge gap, with three in five (60%) not knowing the EPC rating of the property they currently live in.
The research shows that estate agents are being proactive in helping bridge this gap, with two-thirds (66%) in the past 12 months undertaking training to improve their knowledge, and a further 29% planning to do so in the future.
In addition, three in five (61%) have updated their marketing materials in the past year to make energy efficiency information more prominent.
Graham Sellar, Santander’s head of business development – mortgages, said: “The feedback from estate agents is striking and reveals that in an environment of rising cost of living pressures, there has been a real shift in preference among buyers for homes with reduced energy costs.
“Estate agents will be a key part of raising understanding and awareness among buyers and sellers on the benefits of having an energy-efficient home, so it is encouraging so many are being proactive in improving their understanding.
“With the findings showing a clear ‘green home premium’, the benefits are clear, and any changes made will not only reduce buyers’ bills but make the property more attractive to buyers in the future.”