Improving Your Energy Rating Should Increase the Value of Your Home
Since 2009 it became a legal requirement to provide a Building Energy Rating (BER) for your home if you were selling it or advertising it for sale. It is fair to say that for probably the first 10 years of its existence a property’s energy rating wasn’t a major factor in a buyer’s decision to bid on a property. Consequently, for valuers and estate agents a home’s energy rating wasn’t a significant consideration when evaluating a property’s value. In recent years however this has all changed particularly since the energy crises following the war in Ukraine. The consequence of this has been a steadily widening of the gap between properties which have high and low energy rating.
Whilst energy upgrades can slash your energy bills, make your house more comfortable, cut carbon emissions to help tackle the climate crises what is now becoming more evident is that it can boost your property’s resale value.
In recent years we have seen a surge in energy upgrades driven by a combination of the energy crisis, grants from the Sustainable Energy Authority of Ireland (SEAI) and the removal of Vat from solar panels which helped drive the number of home energy upgrades up by 76pc to 48,000 last year.
Last month the Government unveiled a long-promised low-interest rate loan scheme to enable households to fund home energy upgrades. Under the €500m Home Energy Upgrade Loan Scheme, homeowners can borrow between €5,000 and €75,000 for up to 10 years, as long as they combine a loan with an SEAI grant. The loans were designed for homeowners carrying out either a deep retrofit or doing one or two upgrades that will significantly improve the energy performance of the property. The works must improve a home’s energy efficiency performance by at least 20pc.Once approved for a home energy upgrade loan, a homeowner can draw down the funds before the works starts, overcoming the major financial barrier to middle- income households: not having the cash upfront to finance such upgrades.
Deep retrofits are expensive and come with very long payback periods, even when taking SEAI grants into account. The median cost of energy upgrades required to bring a semi-detached home from an E1 building energy rating (BER) to an A2 last year was €37,800, according to an SEAI report. This retrofit would include a heat pump, energy efficient windows and doors, ventilation, insulation and solar panels.
The reality is even with a slashing of your annual energy bill it would take many years if not decades to get the payback on a €35-€40,000 investment. The good news however is that you will have in no doubt increased the value of your home. Of course, you won’t realise that gain unless you sell however if you have a mortgage, you will also qualify for a cheaper green mortgage which will decrease your annual interest repayments.
Check out the renewal energy grant section on the SEAI website below:
https://www.seai.ie/grants/home-energy-grants
This is the link to the segment on loans for home energy upgrades.