DECC: Energy saving measures could increase a property’s value by 14% on average

New research published by the Department of Energy and Climate Change (DECC) has revealed that energy saving improvements could add significant value to properties across England.

According to DECC, improving a property’s EPC rating from band G to E or from band D to B could add more than £16,000 to the sale price of the average property in England.

Those in the north of England can expect an even greater value increase by investing in energy saving measures: In the North East, moving from band G to E could increase the value by £25,355 and in the North West by £23,155.  

Commenting on the results of the analysis, energy and climate change minister Greg Barker said: “We have long known the benefits of making energy saving improvements to the home, but this study is real evidence of the huge potential rewards. Not only can energy efficient improvements help protect you against rising energy prices, but they can also add real value to your property.

James Brooks from Brooks Estate Agents added: “For the majority of the UK we are seeing that there is a new factor dictating a home’s saleability. With fuel bills continuing to rise, buyers are becoming more and more conscious about the energy efficiency of their prospective new homes and are willing to invest more in a property now if they know it will cost them less to run in the future.

“As such, we always try to advise our customers to consider the real S.A.L.E. value – Size, Aesthetics, Location and Efficiency – when buying or selling.”

Currently, 46% of all properties in England are rated at EPC level D. The Coalition hopes that the Green Deal, its flagship environmental policy, will help improve the  

On the role that the Green Deal can play in helping improve the nation’s energy efficiency, Barker said: “The Green Deal is helping more people make these types of home improvements, reducing high upfront costs and letting people pay for some the cost through the savings on their bills. The Green Deal is a great option for anyone wanting to improve the look, feel and potentially the value of their home.”

Kevin McCloud, broadcaster and co-founder of the Grand Designs Future Living home retrofit company, added: “There are some 26 million homes in Britain, most of them about as well insulated as a rabbit hutch, and they need immediate help to be made less wasteful. This timely report tells us what we suspected all along: that people really value the well-insulated, energy-efficient home; that modest investment in measures to make our homes more comfortable, healthier and cheaper-to-run really pays off.

“The Green Deal is now maturing into a helpful way of financing a lot of the retrofit solutions around. Homeowners can now start to make these changes, alleviate the burden of high energy bills and improve the value of their prime asset.”

John Alker, director of policy and communications at the UK Green Building Council, concluded: “This research provides evidence that the retrofit industry has been craving for a long time. Energy efficiency not only reduces bills and makes for a more comfortable home, but – like a new kitchen or bathroom – it can actually add value to the property as well.

“This puts the debate about payback of energy efficiency measures into context because it shows that the householder is likely to recoup their initial investment anyway. It also provides a timely boost for the Green Deal, which will bring down the upfront cost of a retrofit package for those who choose to use it.”

The analysis looked at over 320,000 property sales in England between 1995 and 2011 to determine how influential energy efficiency is in deciding the sale price of residential houses in England. The results of the study can be viewed below:

Energy Rating and Dwelling Prices: Potential £ value increase

£ value increase from properties moving from EPC D to B & EPC G to E^*

¹ = Result is not statistically significant at the regional level; all other results are significant to between 95% and 99.9% confidence levels (see the report for a breakdown of these results).

^* = Reported prices calculated using average sale prices in each region, then applying the report’s price premiums compared to EPC Band G properties.

Energy Rating and Dwelling Prices: Potential % value increase

value increase based on properties moving from EPC G

² = Result is not statistically significant at the regional level; all other results are significant to between 95% and 99.9% confidence levels (see the report for a breakdown of these results).