A report published today by Localis entitled ‘Lagging Behind: energy efficiency in low-viability properties’ highlights the potential risks of ignoring regional variability in house prices and dwelling stock when retrofitting heat pumps to hit decarbonisation targets.
According to the report, in some local authority areas of the north and midlands, the estimated costs of improving home energy can be around 25% of property values, while in affluent parts of London and the south east the cost of retrofitting with heat pumps represents less than 2% of overall property value.
Localis calls on councils, especially in ‘red wall’ areas where property values are low, to collaborate in creating one stop shops as joint ventures engaging with residential landlords to retrofit at pace and use aggregated scale to devise solutions that meet local need and personal circumstances.
Other report recommendations include calls for:
- local authorities to come up with local retrofit jobs strategies to make use of skills and supply chain opportunities
- central government to provide clear and concise information and timelines as well as more readily understood incentives
- The Department for Business, Energy and Industrial Strategy to frontload the £3.8bn Social Housing Decarbonations Fund Demonstrator to deliver cost savings through acting at scale
Localis chief executive, Jonathan Werran, said: “Without a tailored and localised approach that considers the varying housing economics of each locality, a ‘one size fits all’ approach to funding retrofitting threatens to deepen regional inequality and counter efforts to level up in ‘red wall’ areas.
“If the challenge of how to effectively support retrofit properties in low value areas is not met, we risk creating a dangerous divide between different parts of the country.”
Decarbonisation challenge for older housing stock
Ben Beadle, chief executive of the National Residential Landlords Association,said: “With a higher proportion of older stock than other housing tenures, the private rented sector has some of the biggest challenges in meeting the Government’s energy efficiency and decarbonisation ambitions. We therefore welcome news that landlords can access grants to transition to low carbon heating.
“We support the recommendation in this report that extra help should be given to owners of low value properties to make it viable for them to invest in energy efficiency measures and urge the Government to act accordingly.”
Propertymark policy and campaigns manager, Timothy Douglas, said: “A ‘one-sized fits all’ approach rarely works in any policy implementation but when dealing with affordability and property this is particularly true.
“When we look at property value against the estimated cost of retrofit improvements for energy efficiency, we see a stark geographical divide making the feasibility of carrying out works required unequal across the country.
“This means that those living in lower value areas will be penalised when they are unable to afford the measures needed to bring their homes in line with UK Government targets.
“To avoid regional inequality the research recommends a greater degree of strategic planning by local authorities to develop frameworks to help with affordability and spark local economic growth through collaborative working, developing skills, creating green jobs and utilising existing supply chains.”