Tenants to demand energy-efficiency improvements

The market for insulation and other domestic energy-efficiency improvements should receive a further boost from next month, with the introduction of legislation that will require landlords to show tenants the Energy Performance Certificate score for their property.

That is the conclusion of a new survey from the Energy Saving Trust, which found that landlords and property developers are likely to face growing pressure from tenants to achieve high energy-efficiency ratings.

The survey of 2,146 people revealed that seven out of 10 respondents would attempt to drive down the price of a property they were trying to buy or rent if it had a poor energy-efficiency rating, with 85 per cent of those claiming they would start negotiations by demanding that as much as 20 per cent is knocked off the asking price.

In addition, eight out of 10 respondents said that they would reconsider renting a property that had a poor energy performance certificate rating.

Energy Saving Trust chief executive Philip Sellwood said that the demand for energy-efficient properties with an A-rated Energy Performance Certificate will provide landlords and property developers with a commercial incentive to invest in measures such as insulation and double glazing.

"We know that people will look to rent out places that are cheaper to run – it's hardly rocket science," he said. "A poorly insulated three-bedroom semi-detached house could move from band F to band C, saving a tenant £700 a year on energy bills if the landlord installed straightforward energy-saving measures such as insulation… All the evidence points to the fact that an energy-efficient home will be much more appealing to prospective tenants."

The survey also highlighted fears that landlords who undertake energy-efficiency improvements may seek to cover the initial outlay with significantly higher rates, with about two thirds of respondents claiming they expected landlords to seek to recover their costs.

But Sellwood insisted that financial support was available from the government to help stop this from happening, in the form of funding for landlords through the government's Carbon Emissions Reduction Target (CERT) home insulation scheme, and a tax allowance, called the Landlords Energy Saving Allowance, of up to £1,500 per property for landlords installing energy-efficiency measures.

"There is no good reason for landlords to pass the cost of upgrading a property to meet energy-efficient criteria to their tenants," he said. "There is financial support available which can help recoup any financial outlay involved. "