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Achieving Lower Carbon Emissions: New Building Regulations

An ambitious government target of net-zero carbon emissions by 2050 was always going to have a knock-on effect on property developers and investors, as was the announcement of a new minimum EPC rating of C for all households by 2035.

The majority of new-build properties in the UK achieve a B rating or higher. But even where a property meets the new minimum EPC requirements, new building regulations coming into effect imminently place further responsibilities on the shoulders of builders and developers.

A raft of new regulations will come into play as of June 15, 2022. The aim of the regulatory overhaul is to ensure that all new residential buildings constructed in the UK have total carbon dioxide emissions at least 30% lower than current standards.

The new rules will apply to all types of residential dwellings – standard homes, flats, care homes, student accommodation, and so on. Meanwhile, all new-build commercial properties will need to have total CO2 emissions at least 27% lower than current standards.

This has prompted developers across the UK to intensify their research and investment in low carbon technology. Solar panels, heat pumps, and energy-efficient building materials – are all playing a role in helping developers and investors meet the new legislation.

Complicating matters further, there is talk within the government of completely outlawing the installation of gas boilers in residential properties. Set to be a key talking point ahead of the Future Homes and Buildings Standard due in 2025, this shift in policy could constitute another major financial burden for property developers and investors.

Accommodating EVs at Home

As the government continues to encourage motorists to make the switch to electric vehicles, new rules are to be introduced to make EV ownership easier. As part of the new building regulations set to come into effect this month, all new homes with an allocated parking space must have an electric vehicle charger installed by 2025.

This will precede the prohibition of selling all new petrol and diesel cars in 2030. By this point, the government hopes that a significant proportion of the UK population will have made the switch to EVs.

Of course, The initiative is of little to no value to the millions of property owners who do not have their own allocated parking space.

A study conducted by Redrow, a leading UK construction company, found that the preferences and expectations of the British public mirror the government’s new guidelines. When polled, 82% of people said they would be happy to pay a higher price for a home with sustainability features. Likewise, 63% said they would prefer to purchase a green property, if possible.

Consequently, forward-thinking developers and construction companies are investing heavily in ‘green’ technologies and sustainable features for their properties. Not just to comply with the government’s new guidelines but to align with the shifting priorities of the public in general.

New Building Regulations: In Brief

Commenting on the new regulations, Housing Minister Eddie Hughes highlighted the importance of considering the bigger picture.

“Climate change is the greatest threat we face, and we must act to protect our precious planet for future generations,” he said.

“The government is doing everything it can to deliver net zero, and slashing CO2 emissions from homes and buildings is vital to achieving this commitment,”

“The changes will significantly improve the energy efficiency of the buildings where we live, work and spend our free time and are an important step on our country’s journey towards a cleaner, greener built environment.”

Summarizing the new regulations and outlining the government’s policy on transitional arrangements, the following was published on in the form of a press release:

“Under the new regulations, CO2 emissions from new build homes must be around 30% lower than current standards and emissions from other new buildings, including offices and shops, must be reduced by 27%.”

“Heating and powering buildings currently make up 40% of the UK’s total energy use.”

“Installing low carbon technology, such as solar panels and heat pumps, and using materials in a more energy efficient way to keep in heat will help cut emissions – lowering the cost of energy bills for families and helping deliver the UK’s climate change ambitions.”

“All new residential buildings, including homes, care homes, student accommodation, and children’s homes, must also be designed to reduce overheating, making sure they are fit for the future and protect the most vulnerable people. Improvements to ventilation will also be introduced to support the safety of residents in newly-built homes and to prevent the spread of airborne viruses in new non-residential buildings.”

“The changes announced today to the government’s Building Regulations, which set the standards in England for the design, construction, and alteration of buildings, follow a public consultation and will come into effect from June 2022.”

“There will be a 6 month period before the new regulations come into force on June 15, 2022. Transitional arrangements are in place, which means that if a building notice, initial notice, or full plans for building work are submitted to a local authority before June 15, 2022, then provided the building work commences by June 15, 2023, work on that individual building is permitted to continue under the previous standards.”

To date, a number of incentives and rebates have been introduced by the government in order to motivate property owners and developers to take early action. But as most of these incentives have only been open to those able to invest significant sums of their own money in ‘green’ property improvements, uptake has been fairly slow.

Short-term bridging finance and specialist property development finance continue to offer a lifeline to property developers and investors who are asset-rich but cash-poor. Fast-access bridging loans can enable property owners to access the equity they have tied up in their properties in order to take full advantage of any time-limited grants or bursaries the government offers.

For more information on any of the above or to discuss the potential benefits of short-term finance in more detail, contact a team member at UK Property Finance today.