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Will a new home solve the household energy crisis?

Blog Will a new home solve the household energy crisis hero

Historically homebuyers have been torn between the character of a Victorian conversion or a terraced house and the convenience and luxury of a new build. However, with the current energy crisis will new homes now be even more desirable?


Energy consumption is more important than ever as bills are set to soar by a record breaking 54 per cent this year. Poorly insulated homes are going to become expensive to heat very quickly. New build homes are up to 50 per cent more energy efficient than a renovated Victorian property and could save buyers more than £500 per year on heating costs. With highly efficient insulation and enhanced double glazing, new build properties are less susceptible to extreme weather conditions: keeping the home warm in the winter and cooler in the summer.

Energy Performance Certificates

Energy Performance Certificates (EPCs) are mandatory for all domestic buildings when they are built, sold or rented and provide new homeowners with an indicator on how energy efficient their property is and how they can save on costs. While energy performance certificates are likely to play a larger role within the house buying process as energy costs increase, it must be remembered that they are valid for ten years, so depending on when it was carried out last its accuracy could be questioned.

Between January to March 2020, 82 per cent of newly built homes were given an A or B EPC rating, compared to just 2.2 per cent of existing properties during the same period. New builds are specifically built to reduce your bills and offer an impressive energy efficiency, saving you some pennies along the way and contributing towards helping the environment too.

Although a legal requirement, it is not clear whether people consider a property’s energy performance before buying.  However, given the current energy and cost of living crisis, we believe this will become more important as people consider the costs of keeping their new home warm or cool every month, alongside their mortgage, council tax and insurance payments.

New build vs period properties

With Victorian properties being costly and difficult to upgrade to the top energy performance, we foresee new builds having further appeal to the younger, more environmentally conscious generation. They will be attracted to the potential net zero offering and supreme energy efficiency.

The secondary residential market, although characterful, can be expensive to improve energy efficiency. Even once updated, only a small proportion meet the A and B ratings of similar new builds. With rising gas prices, this will likely deter a number of households who may not have the available funds for costly improvements or the monthly charges to heat their houses.

New builds predominantly use electric sources of heating, but it is unsustainable to expect all houses to be run on electricity alone, without significant efficiency improvements. On top of this electrical grid pressures and potential difficulties in electrifying older stock means that the most sensible approach for homeowners of older style houses is to update their homes to be more air tight, with efficient heating systems, to reduce their energy demands.

Blog Will a new home solve the household energy crisis 1

What does the future have in store for new homes?

Operational net zero is certainly possible for new builds, this will be achieved through improving the building fabric. The Government’s Future Homes Standard will ensure that new homes produce at least 75 per cent lower CO2 emissions compared to those built to today’s standards. This means that from 2025 all new builds should not need any retrofitting to become net zero, which will help meet the UK’s target of net zero emissions by 2050. 

However, the embodied carbon from the construction of new developments must also be considered. All activities have an inherent carbon impact, from the production of material, delivery to site and eventual installation. This does mean that refurbishment has an important part to play due to the reduced embodied carbon of retrofitting and refurbishment vs new build. However, we expect to see changes in current construction methods and materials that have a lower embodied carbon. For example increased use of recycled content in materials used as insulation and the use of materials such as timber, which has a lower embodied carbon than steel for example. Coupled with the increased standards this will lead to a higher quality, better performing and more environmental build.

We also foresee an increase in the number of modular factories being built in the UK, which in addition will lead to a reduction in carbon emissions, construction waste and design time. We are already seeing modular construction in modern developments, especially for bathrooms, however we expect this to increase further in the upcoming years.

Considering the housing crisis and the volume of new homes built every year, we expect more legislation to be implemented for the construction industry. This could include the introduction of Home Quality Mark, which is similar to the BREEAM standards seen in commercial property. Home Quality Mark replaced the voluntary Code for Sustainable Homes and essentially scores new homes on their overall cost, wellbeing and footprint. This could be adopted in the future, but the real game change will be whether homeowners actually consider this when buying a property or will it be largely redundant like EPCs.

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About the authors
Chloe Dixon heads up our Residential Consultancy team
and optimises new homes before they come to the market.

James Pay is our head of Client Sustainability, he works with our clients to provide decarbonisation advice, as well sustainable development and occupation guidance.


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Chloe Dixon

Associate Director

Residential - International Properties

London - West End

Chloe joined Colliers in May 2020 and has over four years' experience in New Homes. Chloe studied Real Estate at the University of Reading before joining the Graduate Scheme at CBRE. During her time at CBRE, Chloe worked in the Residential Valuation team, specialising in BtR investment valuations, before moving to the Residential Team where she gained experience in sales, project management and development consultancy.

Chloe now works as a Development Consultant and works closely with the Colliers Land and New Homes teams. Chloe offers advice from the earliest stage, often supporting our clients with the initial land acquisition, through to the sale of the final unit, working alongside developers to optimise the scheme, maximise values and saleability.

Chloe offers advice throughout the development process, offering detailed comparable analysis, demographics data and market commentary to support our pricing appraisals. We also offer design and specification advice with the aim of creating an unique scheme that appeals to purchaser demands. 

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James Pay

Head of Sustainability

Operations

London - West End

James has joined Colliers to help drive our sustainability offering and ensure that we are well equipped to meet and advise on the challenges of the Climate Emergency in a practical and meaningful way for our clients and in-house.

Prior to joining Colliers, James worked in the construction and demolition industries and has over 12 years’ experience working within sustainability for principal contractors and engineering consultancies.

During this time, he helped drive sustainability performance with a particular focus on strategy, the circular economy, carbon reduction and the setting of Science Based Targets, and sustainable certifications such as BREEAM and WELL. He has delivered the sustainability requirements on projects across London, including a global investment bank’s new London Headquarters, the Francis Crick Institute, Chelsea Barracks Phase 4, 100 Bishopsgate, 22 Bishopsgate and Crossrail.

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