Government is on a mission: Retrofit UK’s aged housing stock. This accounts for around 20% of nation’s CO2 emissions.

Its current aim is to have as many homes as possible reach a C rating by 2035 in England and Wales, with an even earlier target being set for private rented homes.

It is an issue for Victorian homeowners in Britain, who could see their Victorian homes lose value as a result of new energy efficiency regulations. 

EPC is a rating scheme which bands properties between A and G, with an A rating being the most efficient and G the least efficient

EPC stands for Efficiency of Property Classification. It is used to classify properties into A or G. A being the most efficient rating, and G being the least efficient.

Rightmove reports that about 33% of homes currently have a D or worse rating. 

According to ONS data, however, those who were built after 1900 had an average E rating due to the lack of insulation and double glazing. 

Upgrading homes to meet the targets could cost up to £65billion, according to Government estimates – and homeowners are expected to foot the bill.

What exactly is an EPC Rating? 

EPC refers to a rating system that ranks properties from A through G. An A rating is the most efficient, while a G rating is the least.

This rating takes into account the energy characteristics of the building, such as its materials and heating system.

Evaluation of Performance Certificates

Band A – 92 plus (most efficient)

Band B – 81 to 91

Band C – 69 to 80

Band D – 55 to 68

Band E – 39 to 54

Band F – 21 to 38

Band G – 1 to 20 (least efficient) 

To generate an EPC score, the survey must be completed by an energy expert and then entered into government-approved software. In order to calculate a score, this is usually 0 to 100. It can also be broken down into domestic property bands from A to G.

This score is valid for a period of 10 years. Homeowners will need to get a new one when a property is rented or sold. Anyone who fails to do so can face a fine.

An EPC rating can be improved by ensuring adequate insulation in the loft, cavity walls, or underfloor, and upgrading to triple or double glazed windows. Draughtproofing, hot water tank insulation, and draught proofing are all examples.

Although there are no current legal requirements that homeowners have an EPC rating of minimum, landlords must achieve one to rent a property.

There are worries that owners of energy-inefficient homes may be subject to increasing pressures to improve their properties.

In consultation with the UK Government, the UK Government sought to determine how mortgage lenders might help households improve the energy efficiency of their homes.

The government currently is analyzing the feedback to determine if it can introduce a goal-based approach to improving energy performance in lenders’ portfolios. This would include proposals for a portfolio average target for EPC Band C by 2030.

Energy efficiency: About three in five homes in the UK have a D rating or worse, whilst those built before 1900 have an E rating on average, according to ONS data

According to the ONS, energy efficiency is about three out of five UK homes have D ratings or worse. Homes built after 1900, however, have an average E rating.

This may lead to mortgage lenders being less willing to lend money on properties with EPC ratings lower than C because they would see their average drop. 

Timothy Douglas, Propertymark’s policy manager, stated that if this was to become effective, it would cause market distortions.

“If it were difficult for people to acquire less efficient properties, such as a house or apartment, the value of these properties would decrease because they are not more attractive or less accessible.

“Traditionally, older properties were more expensive than other properties because they have attractive curb appeal and settings. However, borrowing changes could lead to better properties being valued.

What are the options for homeowners?

At the moment, there is a slight price difference between homes with energy efficiency and ones that have poor energy performance.  

There is a £9,840 difference between an average home with an EPC C and an EPC E rating, based on Savills data, although this increases to £47,605 when comparing EPC B to EPC F.

A recent Rics survey found that although 33% of professionals have seen an increase in the demand for energy-efficient properties over the last year, 34% said that a property’s EPC rating has little to no effect on its selling price.

There is a £9,840 difference between an average home with an EPC C and E rating, based on Savills data, although this increases to £47,605 when comparing EPC B to F.

There is a £9,840 difference between an average home with an EPC C and E rating, based on Savills data, although this increases to £47,605 when comparing EPC B to F.

Rics surveyed more than 50% of respondents and 23% believed it had zero impact.

The government has yet to enforce any regulations or a mandatory energy performance certificate rating of “C” on UK property.

If they do, however, it will most likely impact the supply of Victorian homes in Britain, forcing owners to make upgrades or watch their home lose value.

The cost of upgrading a home from an E to a C rating is more than £17,000 on average, according to analysis by Savills.

These calculations may vary depending upon the needs of every property. Many properties will require new heating systems in addition to other improvements like loft insulation and wall insulation.

The average cost of a heat pump system ranges between £11,000 and £18,000, whilst for homeowners off the gas grid, replacing oil with a low-carbon heating alternative could cost more than £30,000, according to Liquid Gas UK.

Without government assistance, many Victorian-era homeowners across the country won’t be able to pay for renovations.

There are small amounts of funding available depending on how the property is being used.

It includes grants for local authority development, energy company obligation and home upgrade grants.

Adding loft insulation is one of the cheapest and most effective ways to increase a property's EPC rating.

Loft insulation can be one of the most cost-effective and efficient ways to raise a property’s EPC rating.

The vast majority of people don’t have any support, so they either need to make it happen themselves or wait for government intervention.

‘The challenge of incentivising homeowners to retrofit their properties will be made more difficult if the costs involved prove to be too much, especially in areas with low property values,’ said Douglas.

“This is due to the fact that the costs of retrofitting will not be recouped in capital value after work are complete.

“National and regional strategies are needed to provide funding for homeowners to address the huge retrofit challenges that lie ahead.

A reduction in VAT on green home improvements could be one way that the government might encourage homeowners to begin retrofitting their homes.

It might be a way to encourage people to use low-carbon technologies, and increase energy efficiency.

Developers are eligible to claim VAT when they build new buildings or convert non-residential structures such as barns and homes that haven’t been lived in since 10 years.

However, Victorian homeowners who want to renovate their Victorian homes with the most energy-saving improvements available aren’t allowed to.

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