Categories
Lettings Group 2

The ‘grey pound’: why older tenants should be a target

Landlords, who is your target tenant? While traditional focus has always been on Generation Z, Millennials and young families, there is growing evidence that those over the age of 55 are increasingly turning to rented property in their later years.

In 2020, AgeUK reported that 750,000 people over 60 live in private rented housing in England, with the number of households inhabited by older renters doubling in the last 15 years.

That figure isn’t static either – an aspect landlords shouldn’t ignore. A report published in the same year revealed that renters of retirement age and those in the upper-middle age category are the fastest growing tenant groups. 

Privately rented properties where the tenants were aged between 55 and 64 years old had risen 118% between 2010 and 2020, while rented properties where the tenants were aged over 65 had grown by 93% over the same period.

While you may assume older tenants have been forced into renting due to unfavourable circumstances, the New Generation Rent article published by Property Reporter suggests that comfortable baby boomers are actively choosing tenant status, earning their spending power the nickname of ‘the grey pound’.  

With both the Halifax and the Nationwide’s November house price indexes showing that average property values are at record highs, many over 55s are selling now to free capital to fund their retirement, and are choosing to move into rented accommodation in order to watch what the market does next.

Among this age group is hope that house prices will decline, making their next purchase cheaper, while other older renters like the advantage renting gives them in being chain-free when it comes to buying again. 

The article also suggests that many mature tenants will stick with private renting for the rest of their lives, whether it’s for the flexibility, the lower maintenance aspect or as part of  an estate planning exercise.

Older tenants often prove to be very reliable tenants, so landlords should go the extra mile to appeal to this group. Over 55s are likely to be asset rich and less likely to default on rental payments, for low or zero arrears. In addition, they’re unlikely to be involved in anti-social behaviour, can deal with running repairs and basic maintenance without troubling the landlord, and will want tenure security for consistent occupancy.

If you’d like to chase the ‘grey pound’ and appeal to more mature tenants, there are a number of considerations that may improve your chances of success:-

  • Opt for access-friendly flats and houses: consider ground floor apartments, those on upper floors that are serviced by a lift and houses without steps to the front door
  •  Choose locations carefully: town centre living where everything is within walking distance is ideal, as is a property close to a bus stop
  • Offer long-term tenancies: foster a sense of security with tenancy agreements of at least 12 months 
  • Buy new build: brand new properties will present lower running and maintenance costs for both landlord and tenant
  • Consider added extra: on-site facilities, such as a concierge, video entry or gym
  • Think reduced responsibility: developments where communal gardens are tended to and maintenance is taken care of will rent out quickly

Talk to us today about letting a property you own or purchasing a buy-to-let.

Categories
Lettings Group 1

The over 55 tenant takeover is here

It’s no secret that demand for rental property is rising. The letting industry’s main professional body, ARLA Propertymark, has reported year-on-year growth in the number of new prospective tenants registering per lettings branch during 2021. In its most recent report, it revealed that every month, agents were processing an average of 83 renters hoping to secure a tenancy.

There will be assumptions as to who joins the queue of hopeful tenants: students looking to secure a let for the next academic year; couples and friends renting for the first time; professionals relocating to a new city and young families moving for more space or an extra bedroom.

Many landlords will not think of the queue as being populated by over 55s keen to live the rental lifestyle but analysis conducted over the past two years reveals there is a growing number of affluent, able and active mature tenants.

Not catering for the over 55s is a huge oversight that may be capping the success of a buy-to-let venture. For starters, the number of people turning to tenant status later in life is rising. In 2020, a report showed the upper-middle age and retirement brackets were the fastest growing tenant groups.  

The rise, charted between 2010 and 2020, should prompt landlords to sit up and take notice. The number of privately renting tenants aged between 55 and 64 years old had risen by 118% in the decade, while tenants aged 65 or older had grown by 93% over the same period. The growth isn’t a fad either, with research by the Centre for Ageing Better forecasting that by 2040, a third of people aged over 60 could be living in private rented accommodation.

So why are older tenants taking over the private rental sector? The website Property Reporter highlighted how peaking house prices have started a movement among over 55s to sell up and cash in. Swapping a large personally-owned family home for a landlord-owned rented property not only frees up capital for the ‘golden years’ but if the move is to somewhere smaller or with cheaper running costs, it also makes day-to-day living more affordable. 

As well as having more money to fund a retirement lifestyle, renting is appealing as many of the major maintenance aspects are a burden borne by the landlord and not the tenant – freeing time as well as money.

Time and funds are more important than ever among the over 55s – many of whom are working part-time or are fully retired and in excellent health. Mature renters appreciate the same flexible aspects of renting as Generation Z and Millennials do, such as the ability to try new locations, less responsibility and lower set up costs – no stamp duty or large deposits to pay, for example. 

For others, trading an ‘owned’ property for something rented becomes part of a sensible estate planning exercise, with an inclination to remain in rented accommodation for as long as is feasible. With this in mind, landlords looking for long-term, asset-rich tenants should consider the over 55s a valuable target market. 

Appealing to over 55s may mean tweaking your usual approach to lettings, and you may wish to consider the following:-

Offer long-term tenures

Many over 55s will be embarking on ‘one last move’ or a downsizing exercise, therefore they want long-term security without the hassle of having to uproot every 6 or 12 months. Landlords can trade a tenancy agreement of two, three or even more years with a tenant who should be reliable and respectful.

Don’t assume over 55s are IT illiterate

Mature tenants will look for home tech as much as Millennials, so it pays to offer quality broadband, smart energy meters and connections for cable TV. ‘Kerb-to-couch’ technology is another aspect mentioned by Property Reporter, with keyless entry, app-controlled central heating and lighting operated by voice assistants, such as Alexa, all making life easier in later years.

Be receptive to modifications

Under the 2010 Equality Act, landlords are required by law to make any reasonable adjustments to their properties to allow tenants with disabilities to live safely and comfortably – including older tenants whose mobility has been affected by age. Landlords will need to consider future modifications, such as grab rails, ramps, wider door openings and applying for a priority parking bay.

Consider investing in ‘lock up and leave’ properties

Active retirees may be keen to travel, so renting an apartment in a block – ideally with a concierge and secure parking – will appeal to a wide audience. Security in general tends to be important to older renters, so secure front doors, window locks, porches – and video entry when it comes to flats – will find favour.

Highlight the low-maintenance aspect

One of the redeeming features of rental accommodation is the low maintenance aspect, which particularly interests retirees keen to put major DIY behind them. Properties in maintained blocks also have the advantage of a management company looking after communal gardens, common areas and structure elements, such as the roof.

Please ask us about marketing your property to the widest tenant audience. We’ll advise you on how best to improve your property before it is advertised as ‘to let’ possible, and we’ll manage the tenancy agreement negotiations for the best outcome

Categories
Lifestyle Group 1

Winter warmers: staying safe and snug this winter

As the temperature drops, we have a tried and tested routine: dig out hats and scarves, revert to warming soups and casseroles, and start speculating about snow days, but what about our homes?

Preparing our properties for inclement weather is more important than ever this year, with many of us mindful about the amount of gas we are using and how low the temperature may drop, thanks to climate change. Now is a good time for a reminder of the basics that may save your boiler breaking down or a pipe bursting. 

The age-old debate still rumbles on – keep your heating on a low setting all the time or only turn it on intermittently? Current thinking revolves around insulation. If your home is well insulated, leaving your heating on is a good option as it may not kick in very often. For those in older, poorly insulated properties, using a timer so the heating only comes on when it’s needed is a more cost-effective approach. 

There’s no harm in trying both methods if you have a smart energy meter, as you can compare costs. You can reduce energy consumption further by using radiator or underfloor heating thermostats to only heat the rooms you occupy, as well as by avoiding plug-in heaters (the Energy Saving Trust says using an electric heater is more than twice as expensive as using central heating), ensuring you have good insulation and keeping draughts out.

Pipework and central heating go hand-in-hand, and the real danger is when temperatures drop below freezing. If your property is left vacant – whether it’s overnight, for a week or for an extended period – leaving the central heating on and set to a minimum of 13 degrees will ensure any standing water in the pipes doesn’t freeze. Frozen water expands and creates pressure, which can rupture a pipe. Any crack or hole will start leaking water as soon as the temperature rises, which will result in a sudden flood or a slow drip – both highly damaging.

You can also protect pipes from freezing by lagging – the process of wrapping them in insulation material, such as foam sleeves. Pay particular attention to pipes in lofts, garages, basements and those that sit against external walls. It’s also sensible to insulate any outside tap and an older-style hot water cylinder.

If a property is going to be uninhabited for a long spell over winter, it’s wise to play it safe and turn off the water supply at the mains stopcock. Don’t forget, most modern central heating systems still work even if the water supply is turned off.

There is another pipe that’s often overlooked and when it freezes, it’s one of the most common reasons gas engineers are called out. The condensate pipe is what removes steam and condensation from a condensing boiler. If the temperature drops below zero, the condensate pipe can freeze solid and cause the boiler to shut down. 

As well as insulating this pipe, you can reduce the chances of it freezing by shortening the amount of pipe that sits outside, making the condensate waste pipe as large as possible with a vertical fall and opting for a boiler with a syphon trap type of water release, rather than a continual drip. 

There’s one final leak that property owners should be mindful of during winter and that’s carbon monoxide – a poisonous gas that can emanate from cookers, blocked flues and chimneys. As well as getting your central heating boiler serviced on an annual basis and installing a carbon monoxide detector, it’s wise to get a health check for other gas-fired appliances and book a chimney sweep before the first fire is lit.

If you have any questions about looking after a property during the winter months, feel free to get in contact with our team.

Categories
Lifestyle Group 2

Top property tips for cold conditions

How do you create heat in an efficient way, prevent property disasters and keep energy bills in check when mother nature is throwing freezing rain, snow and sub zero temperatures our way? Here are our top 4 property tips for cold winter conditions.

1. Be heat smart: we may be a little more economical with our gas consumption thanks to rising fuel costs and climate change but it’s still possible to create a toasty warm home. If you have radiator thermostats, use them to only heat the rooms you’re using or turn down your main thermostat by one degree. You’ll still generate warmth by doing the latter but, according to uSwitch, you’ll save an average of £80 a year on your energy bill.

The jury’s still out on whether it’s best to keep your heating on low permanently over the winter or programme it to come on when it’s needed most. If you have a smart energy meter, you could try each method for two weeks and see what uses the least gas.

2. Stop warmth escaping: there’s no point creating warm air only for it to leak out and let a cold draught back in. Check for gaps around windows and doors, sealing with caulk and replacing weather stripping around doors if in poor repair. Even an old fashioned draught excluder will help if you feel a chill around your ankles.

You can use expanding foam insulation to fill large holes where pipes leave the property and if fireplaces are not in use, consider getting the flue capped. Don’t forget to check for draughts around cat flaps – you’ll be surprised how much warm air seeps out of a poorly fitted one.

3. Reduce  the risk of leaks: Some of the most common insurance claims stem from water leaks, and the problem is exacerbated over winter. When water freezes in pipes, it expands and can cause the pipe or weak joints to burst open. A leak will start as soon as the water starts flowing again – if it’s a slow trickle or the property is vacant, the water damage may go unnoticed for months. 

Use foam sleeves to lag pipes in lofts, garages and basements where it tends to be coldest, and don’t forget any pipes fixed to external walls and your boiler’s condensate pipe. If the latter freezers, the boiler will shut down when its needed most. 

Another freeze prevention method is leaving the heating on low (13 degrees minimum) throughout cold snaps, even if no one is living in the property. If a property is vacant, it’s also wise to turn off the water from the mains stopcock.

4. Create a safe environment: everyone should get their boiler serviced on an annual basis, not just landlords. While you have a Gas Safe registered engineer in your property, it’s worth getting them to perform a health check on other gas-run appliances, such as hobs and fires, which may be used more heavily over winter. 

As well as installing a carbon monoxide detector and checking it works on a regular basis, book a chimney sweep to prevent a deadly build-up of gas that a blocked flue may prevent escaping.

If you’d like to discuss winter proofing your property or you feel now’s the time to move on to somewhere new, give us a call today.

Categories
Sales Group 2

Storage sells: buyers will pay more for space

What sellers assume adds value and what buyers don’t mind paying over the asking price for may not match, if the results of a new survey are to be believed.

While it’s common to think purchasers will stretch their budget for a property with a newly-installed bathroom, an all-singing, all-dancing garden room or perhaps off-street parking, lots of storage is actually one of a home’s most valuable aspects.

When Hammonds Furniture conducted a survey to establish what Brits valued most when buying their next home, 84% said adequate storage space was a must. In fact, those that took part in the survey said they would be willing to pay an average of £12,574 more for a home with lots of storage space to put their possessions. 

In some cases, storage was such a priority that buyers would be willing to exceed a property’s asking price for the luxury of space and storage facilities, with 7% of survey participants willing to offer £55,000 more that the advertised price.

The survey results also found the appeal of storage does wane with age. Those below the age of 44 were most likely to increase their offer to secure a new home with good storage, while those over the age of 45 would pay the smallest amount over the asking price to be successful.

Storage is such a broad term that the survey wanted to establish what specific storage options would be most likely to prompt buyers into increasing their offer. A garage was the top storage option, with 42% of buyers willing to pay more for a property with this facility. 

A utility room was also well ranked by many purchasers, with 40% saying they’d up their offer if a home had this small but useful room. Another top-performing storage asset was a kitchen with plenty of cupboards and drawers – with 34% saying they’d pay more for this benefit.

While the survey results have highlighted that storage is a winning factor when it comes to encouraging buyers to make attractive offers and even bid over the asking price, good storage can also help sellers during the viewing process.

It’s no secret that people will be put off if your worldly goods are scattered about the house, and a neatly organised home will impress potential buyers and add value too. Even how you utilise what storage you have can impact the interest in and offers on your property – chaotic scenes may suggest there isn’t enough storage for the size of the property.

In most cases it’s not the amount of storage that’s the issue but the way the items are folded, stashed and stowed. When you’re getting your property ready for viewings, it’s worth spot checking your storage beforehand

  • Prioritise small rooms that can feel cluttered: Ideal Home’s storage solutions for small spaces is a brilliant place to start.
  • Reinvent the everyday: if your storage is from the big Swedish warehouse, why not upgrade it with one of House Beautiful’s amazing Ikea hacks?
  • Make sure drawers and doors close fully: first impressions will be improved if the contents are not spilling out.
  • Reorganise chaotic shelves: pay attention to places that potential buyers may investigate, such as the airing cupboard. 

If you’d like more advice on getting your property ready to sell on the open market, talk to our team today.

Categories
Sales Group 1

Supercharge your sale with storage

The ‘race for space’ is a well-used phrase to describe the property buying activity over the last 12 months. We’re all pretty familiar with the idea that people have been moving to gain a home office, an extra bedroom or more of a garden but there’s another form of space that’s highly prized by home buyers.

Storage is a top seller

When looking at houses and flats for sale, today’s buyers are craving good storage and they’re willing to pay extra for the privilege. Hammonds Furniture wanted to find out just how much more potential purchasers were willing to fork out to have ample space to store their stuff, so it surveyed 2,000 Brits.

Attract up to £55,000 extra

The results were eye-opening. Of those questioned, 84% said adequate storage space was a must when looking for a new home. Everyone was willing to pay more money for a property where there was good storage – to the tune of £12,574, on average. Storage was, however, more valuable to some than others. Of those surveyed, 7% said they would be willing to offer £55,000 over the asking price if they were particularly impressed.

Age is a factor

Perhaps it’s because we are encouraged to declutter and downsize as we get older but younger home movers place more value on storage. The survey found those under the age of 44 were most likely to increase their offer by an average of £15,870 in order to buy a property that met their storage needs. In contrast, those aged 65 and over would only offer £8,710 above the asking price for a home because of storage perks.

What adds the most value?

There’s storage and then there’s serious storage. Thanks to its size, space and versatility, a garage was the top storage option, with 42% of buyers willing to pay more for a property with this facility. Also well regarded was the small and mighty utility room – a feature that would encourage 40% of buyers to offer over the asking price. Even a kitchen with lots of cupboards and drawers would push 34% of buyers to make higher offers.

Storage matters more to…..men

One of the most surprising statistics from the survey was the willingness of men to pay more for storage than women. Although both placed value on storage facilities, men were prepared to offer £13,814 more than a property’s asking price, whereas women would increase their offer by £11,565.

How to maximise your storage before a sale

If you are selling your home soon and want to attract the best offers, pay attention to storage before you go on the market. You may like to consider the following:

  • Think statement storage: it doesn’t have to be plastic or dull. LivingEtc has some fantastic ideas for those who don’t want to compromise the creativity of their home.
  • Ensure your existing storage is well organized: think neatly-folded bed linen and drawer inserts that prevent a jumbled mess.
  • Create a pantry: add shelves and internal lighting to an underused cupboard to create an on-trend pantry.
  • Under stair stars: consult with a carpenter to see if your void under the stairs could be transformed to provide extra storage.
  • Invest in storage: clutter hotspots can be overcome with added storage – buy something freestanding and it can move with you.

Thinking of selling your home? Start with one of our free valuations, which will take into account your storage and any other beneficial features within your home.

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Lettings Group 1

Eco follow-up: Information for Landlords

Unless you’ve been living under a stone for the last month, you’ll know green issues are the number one topic of conversation. While world leaders have debated coal mining and deforestation, there are a number of take-aways from recent weeks for landlords and tenants.

Boilers: in the biggest shake up of how we heat domestic homes in living memory, the Government’s Heat & Building Strategy sets out the end of gas boiler installation. Property investors who develop their own portfolio will be the first to be affected, as the fitting of conventional gas boilers in new properties is to be prohibited from 2025.  

All landlords need to take note of the second deadline. From 2035, the sale of conventional gas boilers will be banned, meaning that if a gas boiler breaks or is condemned in a buy-to-let property from 2035, it cannot be replaced with another gas boiler. Existing gas boilers that work, however, won’t have to be removed.

There is financial assistance available to landlords who would like to make a move away from gas fired central heating sooner than the 2035 deadline. The Clean Heat Grant is launching in April 2022 and landlords can apply for up to £5,000 of financial help to install a heat pump system – the Government’s preferred method of heating rental properties moving forwards. 

The £450 million fund will cover around 90,000 heat pump installations (which currently cost an average of £10,000) but it will be offered on a ‘first come, first served’ basis. We advise those hoping to take advantage of the grant to apply as soon as the initiative is open for applications.  

Funding: a fund worth £4.3 million is going to be shared by local councils in a bid to raise energy standards in the private rental sector.  Some 100,000 extra engagements with landlords will encourage them to comply with current eco regulations and make energy saving improvements – not only to save the environment but also to lower the fuel bills of tenants amid growing fears of fuel poverty. Part of the initiative is to offer landlords free property surveys that will identify where alterations can be made.

Green mortgages: eco-based lending is gaining traction and landlords with the highest EPC ratings now have access to the most favourable interest rate repayments and priority products. It is already reported that the number of ‘green’ buy-to-let mortgages has quadrupled in the past six months, with landlords encouraged to trade energy-saving improvements for advantageous lending conditions.

MEES may get stricter: MEES (Minimum Energy Efficiency Standards) for private rented properties may get tougher in the near future. Landlords need to watch the deadline of 2028, when the Government has proposed that all new, renewing and extending tenancies will need to have an EPC rating of C as a minimum. There’s also an ambitious plan for the eco bar to be raised even further, with the Government’s energy white paper aiming to outlaw new, renewing and extending tenancies that fall below a B from 2030.

If you would like to discuss energy efficiency in a rental property, please don’t hesitate to get in touch.

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Lettings Group 2

Gas boiler ban: 6-step action plan for Landlords

The flame on conventional gas boilers is set to be snuffed out after the Prime Minister fleshed out his Net Zero agenda ahead of the COP26 climate change conference. His address reiterated two deadlines that the rental sector needs to keep an eye on.

In 2025, house builders and property developers will be banned from installing conventional gas boilers in the new properties they build. In 2035, the sale of conventional gas boilers will also be banned. 

The new rulings will prompt more landlords to explore alternative heating options in their buy-to-let properties. Although existing gas boilers can stay in rented houses and flats, a like-for-like gas boiler will not be a viable replacement should the model be condemned or fail beyond repair.

While 2035 may feel too far in the future for it to be an immediate concern, landlords may need to make heating changes sooner than this, as the Government is on course to further improve energy efficiency in rented properties. By 2028, the Prime Minister wants all new, renewing and extending lets where the EPC is below a C to be made illegal, with this standard rising to a B rating from 2030. 

Currently all let properties need an EPC rating of at least an E to be legally compliant, so a steep jump in minimum energy efficiency standards may be ahead. Improving the energy efficiency of a buy-to-let with greener heating systems will go a long way to achieving a higher EPC rating, so what should landlords do next? Here’s our recommended plan of action:-

  1. Check your buy-to-let’s current EPC rating: if your rating is an E, you’re in the danger zone and risk slipping into unlawful territory. An EPC is valid for 10 years so if yours is close to expiring, be aware that your let may be reclassified when a new EPC is issued.
  2. Get a boiler health check: a landlord’s gas safety responsibility involves an annual gas safety check and required maintenance, so why not book a boiler health check at the same time? You’ll find out the predicted lifespan of your boiler, and where you stand in terms of parts and performance.
  3. Think about heating alternatives: the Government would like gas boilers replaced with air, ground or water heat pumps. They are currently more expensive to purchase and fit than most gas boilers – around £10,000 – but this cost is set to reduce as more people switch. Other options open to landlords include all-electric heating – such as storage heaters and hardwired underfloor heating.
  4. Apply for a heat pump grant: to help finance a quick switch to heat pump systems, the Government is making £450 million available to property owners – including landlords. The Clean Heat Grant launches in April 2022 and successful applicants will receive up to £5,000 to put towards the cost of a heat pump installation. There are limited funds available, however, so those considering the switch should apply as soon as the grant launches.
  5. Keep your current boiler serviced: there is no indication that existing gas boilers in good working condition need to be removed now or in the future. If your EPC is already above an E and you’d like to avoid installing a heat pump system for now, look after the existing  gas boiler in your buy-to-let with annual servicing.
  6. Replace any old gas boilers soon: there’s a window of opportunity to replace ageing gas boiler models before the ban on public sales comes into effect in 2035. New gas boilers offer greater energy efficiency, will reduce the fuel bills of tenants and, if serviced, may keep heating your let beyond 2035.

If you’d like to discuss your buy-to-let’s current EPC rating or are considering energy saving improvements, get in touch with our team.

Categories
Sales Group 2

Are gas boilers banned?

While there was no mention of stamp duty, first-time buyers or inheritance tax in 2021’s Budget, October has left homeowners with a number of pressing questions. The majority of them stem from the Prime Minister’s Net Zero announcement made earlier in the month – a proclamation of eco intent with a particular focus on domestic heating.

We have already been contacted numerous times for clarification on the future of gas boilers in the home, so we have answered the most commonly asked questions below.

Do I have to remove my gas boiler now?

No, if you have a safe and functioning gas boiler, you can continue to use it until it is condemned or is broken beyond repair. We recommend getting your boiler serviced annually to keep it working efficiently and to prolong its lifespan.

Are gas boilers going to be banned in the future?

Yes but there’s no immediate panic. The first change will come into effect in 2025, which will ban house builders and developers from installing conventional gas boilers and their oil-fired counterparts in the new properties they build. The next ban will happen in 2035, when new gas boilers will be withdrawn from public sale. If your gas boiler breaks down after 2035, you will not be able to replace it with another gas version. Until then, you can swap your current gas boiler for another gas model without issue. 

What are the alternatives to a conventional gas boiler?

The Government ideally wants us all to install heat pump systems, which come in air, ground and water versions. Alternatives include biomass boilers, which run off wood chips, logs or pellets, and solar panels, or homeowners could go down the all-electric route. At the moment, oil-fired systems and wood-burning stoves are still permissible heating methods but it’s unclear whether you’ll be able to buy a brand new oil-powered boiler after 2035. It is hoped boilers that run off hydrogen may be developed for use in a domestic setting but this may take a decade or longer to come to fruition.

Aren’t heat pumps costly to install?

At the moment, heat pumps are still a niche heating product, therefore the costs to supply and install are pretty high when compared to a gas boiler (expect to pay in the region of £8-£10,000 for an air heat pump). The energy savings should help the technology pay for itself over time.

Will the Government pay for me to switch to a heat pump?

Possibly. A £450 million fund called the Clean Heat Grant is being launched by the Government in April 2022. Households can apply for up to £5,000 to put towards the cost of a heat pump system, although the money will only help around 90,000 households before it runs out, with the fund available on a ‘first come, first serve’ basis. Any shortfall in purchase and installation costs will need to be met by the homeowner. 

Will a gas or oil-fired boiler hinder my house sale?

This is an interesting question. Purchasers are becoming more concerned with EPC ratings as fuel bills rise and they realise an inefficient boiler will use more gas or oil. It’s possible buyers will favour homes for sale that have a heat pump as not only will it deliver monthly energy savings, it will ‘future proof’ a property they want to buy . It’s also worth noting that the Government is considering setting minimum energy standards for every home in the country by 2050, and an inefficient boiler could stop properties meeting any future standards – potentially jeopardising a sale.

Is it true an inefficient boiler may prevent me from getting a mortgage?

No, not directly but there is some truth in the rumour. The Government is asking mortgage lenders to help it achieve its eco agenda by giving greener homes preferential treatment. Purchasers borrowing money to buy homes with the highest energy standards will be offered the best mortgage deals, while banks and building societies will be asked to disclose the average EPC of its loan portfolio in a bid to ‘shame’ those who finance too many energy-inefficient properties. The extreme outcome may be some homes will become unmortgageable due to very poor EPCs, or a property will need to be brought up to a higher EPC rating before it’s legally allowed to be sold on the open market.

Why is the Prime Minister so concerned with central heating? 

The Government has set an ambitious target to be a net zero carbon emissions country by 2050 and with residential property currently responsible for 16% of the UK’s total carbon emissions, getting the nation to switch to greener ways of heating our homes is seen as a crucial part of eco success.

If you are wondering what your current EPC rating is or would like advice about selling your property with its current boiler in place, get in touch today.

Categories
Sales Group 1

Extinguishing the gas boiler flame: home heating latest

While most of the country was glued to October’s Budget, hoping for news of a cheaper pint or a public sector pay rise (yes to both), there was very little in Rishi Sunak’s address that directly affected property buyers and sellers.

Although there were notes for the housebuilding sector and welcomed funds for those caught up in the cladding scandal, it was actually an announcement the previous week that will have the biggest impact on everyday property owners and future home movers.

Prime Minister Boris Johnson unveiled more details of his Net Zero green agenda in October, with a focus on the future of domestic heating. Responding to the statistic that residential property is currently responsible for 16% of the UK’s total carbon emissions, gas boilers will eventually be replaced with greener ways of heating our homes.

The news is important for purchasers and sellers of property as the age of a boiler installed in a property and the fuel it runs on will become a big part of the decision-making process in the future – and it may even affect a buyer’s ability to get a mortgage. So, what are the top take-aways from the Prime Minister’s latest eco address?

The good news is there are no imminent changes and it’s fine to keep heating your home with a gas boiler. The key dates are 2025 and 2035, depending on who you are. The first adjustment applies to house builders and developers, who will be banned from fitting conventional gas boilers in new properties they construct from 2025.  

The second change won’t happen until 2035, when the sale of gas boilers will be prohibited. What does this actually mean? If your current gas boiler is condemned, is beyond repair or needs upgrading due to inefficiency, you won’t be able to replace it with another gas boiler after 2035.

There is no suggestion that perfectly fine, working gas boilers fitted to UK homes will need ripping out in 2035. If it’s annually serviced and safe, homeowners can continue with their current gas boiler until it irretrievably breaks down or is deemed unsafe to use.

Many homeowners are beginning to question what the alternatives to gas boilers are. The Government is hoping we’ll all convert to heat pumps – either water, ground or air types. And the cost? Currently the average supply and installation of an air heat pump will set you back approximately £10,000. 

Encouragement to make the switch to heat pumps sooner rather than later is coming in the form of a boiler upgrade scheme. Some £450 million is being made available, with households able to apply for a grant worth up to £5,000 to help fund a new heating system. The scheme, to be called the Clean Heat Grant, will launch in April 2022, and the current plan is for energy regulator Ofgem to become the scheme’s administrator.

Experts have, however, sounded a note of caution. Calculations show the £450 million fund will only cover around 90,000 heat pump installations and those interested will be processed on a ‘first come, first served’ basis.

So are there alternatives to heat pumps? There is nothing stopping homeowners looking after their current gas boiler until it reaches the natural end of its lifecycle, which could take them beyond the 2035 deadline. An ambitious and not totally reliable alternative would be to bank on hydrogen technology being made widely available in the future. It is hoped ‘dual fuel’ boilers that start by running on gas but can switch to hydrogen power will advance to such a state that they can be installed in domestic settings, but the jury is out on whether this will be possible.

There is also the option to go all-electric with storage heaters, electric radiators and hard-wired underfloor heating, with additional options including wood-burning stoves, solar panels and oil-powered central heating. The future of oil-fired boilers is unclear at this stage, although we do know they will also be banned from new builds from 2025.

A word of warning when considering future sources of domestic heating. Boris Johnson has also underlined his intention to make it harder to mortgage homes with the worst energy ratings in the future.

Banks and building societies will be encouraged to offer the best mortgage deals to the properties with the highest EPC ratings, and the danger is that properties with poor eco standards will face higher-than-average arrangement fees and interest charges – or they may even become unmortgage-able. 

The Government is also considering introducing a date for all homes to meet minimum energy standards, ahead of its 2050 net zero target. What exactly does that mean? The Prime Minister wants all owner-occupier homes to be of a certain ‘green’ standard, achieved through eco-improvements and energy assessments. Heating your home in the most energy efficient way will help homeowners reach any new targets and it’s quite possible, but not confirmed, that homes with a poor EPC may become more challenging to sell in the future, forcing the owner to make eco alterations.

If you would like to chat about your current central heating or EPC rating, get in touch today.