Race to net-zero
The UK Government's ambitious net-zero carbon target by 2050 has put the spotlight on climate change and its connection to the property sector. However, achieving this goal in the housing sector poses significant challenges.
Households, as major emitters of greenhouse gases, account for 26% of total emissions in the UK, based on residency data from the 2022 Office of National Statistics quarterly report.
With landlords needing to spend around £10,000 on average per property to achieve a C rating and reduce their footprint, it is becoming an uphill challenge to invest in updating rental stock and meeting the upcoming change in standards.
The Road to Net-Zero
To achieve the net-zero target, various initiatives are necessary to bring about essential emissions reductions.
One such idea is the "fabric first" approach, which emphasizes understanding a building's structure and materials to enhance energy efficiency instead of relying solely on retrofitting or rebuilding. Creating an open-access digital register of building types and materials can facilitate the identification of suitable retrofit solutions that align with existing structures. The current retrofit market in the UK, valued between £3.5 billion and £6.5 billion annually, offers a compelling reason to focus on poorly performing properties.
Leveraging Smart Sensors
Deploying smart sensors throughout properties allows for the collection of diverse data points to monitor and inform various aspects, from temperature control in short-term rentals to energy consumption in HMOs.
These sensors can:
measure carbon monoxide levels
detect moisture changes to prevent dampness and mould
remotely test smoke alarms for safety compliance
monitor activity and safety for assisted living residents
conserve energy by turning off lights when unoccupied
manage heating through smart thermostats
Proactively addressing inefficiencies identified by these sensors can significantly improve property performance and efficiency. Real-time monitoring and analysis of data facilitate predicting and addressing inefficiencies promptly, accelerating the pace of change.
Data collection and Government-Driven Incentives
Advancements in reporting software enable seamless data access and sharing through embedded sensors, facilitating real-time analysis for agents and maintenance providers. This swift response can be crucial in safeguarding residents' health and property safety while driving toward carbon neutrality.
Government-driven incentives are vital to encourage the industry to invest in energy efficiency measures. Energy efficiency grants include:
EV charge point grants
Insulation grants
Local authority grants for conversions and improvements
Funding for bringing rental properties up to minimum heating standards
The Road Ahead for the Net-Zero Rental Market
Energy efficiency already influences tenants' decisions, with most seeking EPC ratings before considering a property. Agents equipped with data proving a property's sustainability and environmental credentials will attract quality tenants and potentially command higher rental prices.
To achieve a resilient, net-zero rental market, the industry must embrace technology and adopt a long-term perspective. Landlords who future-proof their assets through technological advancements can achieve better returns on investment and a competitive edge. Education and accessible, affordable technology are crucial to garnering widespread support for these initiatives.
As we strive to achieve a net-zero rental market, we not only safeguard our planet but also shape the future of our industry.
