There may be increased interest in going green among homeowners but Nationwide suggested that it doesn’t actually make much difference to house prices.
Using data for homes in England, the building society examined the extent to which those buying properties pay a premium, or discount, due to the EPC rating.
The analysis suggests that a more energy-efficient property rated A or B attracts a modest premium of 1.6% compared with a similar property rated D.
This is equivalent to around £4,500 based on the average house price in England.
BENEFITS OF GOING GREEN
There is little difference for properties rated C or E, compared with D, as shown in the chart below.
Nationwide said it does see a small discount for the least energy efficient properties, with an F or G-rated home valued 1.4% lower than a similar D-rated property. This equates to around £4,000 in cash terms.
However, Robert Gardner, chief economist for Nationwide, says energy efficiency continues to have a much greater impact on buy-to-let purchases, where an A or B-rated property attracts a 12.2% premium.
GREEN IMPROVEMENTS
Nationwide highlighted market research suggesting around three quarters (78%) of homeowners expect buyers to pay more for an energy efficient home.
This was particularly evident amongst younger buyers, where nearly a third (32%) of those aged 25 to 34 expected buyers to pay significantly more for an energy efficient home, compared with just 5% of those aged 55+. Additionally, 69% of respondents believed that EPC ratings/energy efficiency matters more now than when they bought their home.
More than half (54%) of those surveyed were not aware of their current property’s energy efficiency rating. Despite this, 77% said that EPC rating would be an important factor when choosing a property to buy in the future. Again, this appears particularly significant for younger buyers (i.e. those aged 25-34), where nearly half (49%) stated this would be ‘very important’.
Of homeowners who had undertaken measures to improve their property’s energy efficiency in the past ten years, the most popular were: adding solar panels, improving insulation and upgrading to energy-saving windows and doors.
The main reasons cited for making green improvements were to reduce energy bills (60%) and to make their home more comfortable (48%).
