The UK government has implemented a legally binding commitment to achieve net-carbon zero by 2050, meaning that new-build homes must be ‘zero carbon ready’ by no later than 2025. These legal obligations are arising in the form of new rules, regulations and best practices which affect many sectors of property.
With 40% of all UK emissions originating from households, further regulations and policies surrounding the environmental performance of property is virtually inevitable. Ultimately, by 2025, new homes will have carbon dioxide emissions 75-80% lower than those built to current building regulations. Whilst this is a huge target to reach, a collaboration between all areas of the housing industry will make this goal a reality.
As the founder of the property network and marketplace platform, The Landsite, I have been looking at ways the industry is shifting towards a greener outlook and analysing the areas which need improving. With this in mind, I've provided my experienced insight into the multiple ways property investors can contribute to the 2025 carbon target.
Review your portfolio
This 2025 carbon target is due to increase the minimum standard that is expected when it comes to the eco-credentials of all properties. Less environmentally-friendly properties will undoubtedly be worth less in the future in comparison to ‘greener’ builds.
It’s important to consider how this shift towards a more sustainable society should affect how you do business. It will become more crucial in the coming years to invest sustainably, in doing so, it also makes you more appealing to tenants, banks and other business.
Despite new builds being an incredibly energy-efficient property type in terms of investment, it’s worth noting that less than 1-2% of total annual building stock is new-build, meaning that there should be a greater focus on retrofitting existing properties.
For those properties in your portfolio that are older, both operational carbon and significant embodied carbon savings can be achieved through the practice of retrofitting. Property investors can enhance their investment with a wide variety of sustainable features.
Consider energy sources, for example. Rather than relying on a single alternative energy source, try combining several. Solar energy is perhaps the most popular alternative source of energy in domestic spaces, and it can be comfortably paired with air or ground source heat pumps, to make a home even more eco-friendly.
Although retrofitting can be a costly process in some cases, there are talks of subsidies and grants being made available to help get older properties up to scratch.
Invest in newer property
According to the Royal Institute of Chartered Surveyors (RICS), around 15% of the UK’s total emissions currently stem from heating homes, with less than 5% of the energy used for this deriving from low-carbon sources. Understandably, this has been highlighted as one of the key areas for change.
New builds tend to have the highest Energy Performance Certificate (EPC) ratings and higher build quality to meet current National House Building Council (NHBC) standards, making them one of the most energy-efficient property types to invest in.
The government is committed to ensuring all UK properties meet a minimum EPC rating of C by 2035, and investing in new-builds should help to ensure that this standard is met. These properties are also likely to be more appealing for eco-conscious buyers.
Networking and collaboration
If members of all areas of the property sector made the push to be more collaborative, carbon neutrality would be an even more achievable goal.
Opening up a discussion with other experts, those who specialise in sustainable construction or architecture, for example, will help to establish exactly how to make properties meet and surpass energy efficiency standards, as we move into a greener tomorrow.
Everything from the sustainable materials used in the construction and insulation of a building, to the green spaces included and the overall design, must be considered in the effort to reach the zero carbon ready target of 2025. A platform on which all those in the property sector can source sustainable materials and discuss the process of carbon neutrality with other professionals, such as The Landsite, is ideal in an age which demands more eco-friendly practices.
As the clock ticks ever closer to 2025, it is a property investor's responsibility to make conscious investments. The above is all conducive to this necessity, but it’s essential for any investor to take it upon themselves to read up on all the new policies surrounding the zero-carbon target.
Green properties are not only valuable for the planet, but they are ultimately worth more to an investor too.
*Ramsey Assal is the founder of property networking platform The Landsite