Study finds improving the energy efficiency of your home through green deal scheme could substantially improve its value
Improving the energy efficiency of your home could increase its value by up to 38 per cent, according to new government figures to be released today.
A study of over 300,000 property sales by the Department of Energy and Climate Change (DECC) has concluded that installing measures such as loft insulation or efficient boilers to raise a home’s energy rating from band G to E could mean adding more than £16,000 to the sale price.
Moreover, the same improvement from band G to E can boost the price by over £25,000 for the average house in the North East and £23,000 in the North West, while London homes could experience a £41,000 uplift.
Energy and Climate Change Minister Greg Barker said the figures showed the “huge potential rewards” of the government’s Green Deal scheme, which aims to improve the UK’s draughty housing stock by providing financing packages to cover the upfront cost of refurbishments.
“Not only can energy efficient improvements help protect you against rising energy prices, but they can also add real value to your property,” Barker said in a statement.
“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.”
Around a third of the UK’s emissions come from housing making it one of the most cost effective areas for targetted action to reduce emissions.
While the Green Deal is aimed at tackling the poor levels of energy efficiency found in many homes, the scheme has reportedly suffered relatively low take-up rates to date amidst criticism of the high interest rates attached to the financing packages.
Labour has warned that a household taking out a 25 year Green Deal package worth £10,000 at the standard 6.96 per cent rate of interest would end up repaying close to £21,000 over the course of the loan, potentially undermining some of the resulting increase in house prices.
Industry figures have also revealed a drastic slow down in the roll out of insulation improvements, as previous support schemes have been phased out and the Green Deal has so far failed to replace the demand that has been lost.
However, the government has maintained that interest in the Green Deal is building and has consistently argued that the combination of competitive interest rates and cash incentives makes the scheme an attractive proposition for many households.
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