Sustainability has become a key business objective for many different industries in recent years, as companies assess their environmental responsibility. The housing business is one of the major industries attempting to incorporate sustainability and combat climate change. According to a study by Lloyds Bank, residences currently utilise 35% of the nation’s energy and emit 23% of the nation’s total carbon emissions, making it necessary for housebuilders to explore techniques for developing beautiful neighbourhoods while delivering “greener” homes that benefit both the planet and the homebuyer. Cheltenham’s trusted independent estate agents guide us on the onerous challenge that this entails.
The UK Government’s commitment to sustainable housing:
The UK government set a goal to decrease carbon output and greenhouse gas emissions to zero by 2050, putting housing providers under pressure to build energy-efficient features into their homes. As a result, the UK property market is experiencing a significant rise in sustainable real estate as the world becomes more concerned about climate change.
The importance of sustainability in the property market is increasing, and developers and property owners are recognising the value of environmentally friendly building practices. Green buildings are not only beneficial for the environment, but also for the property market, with higher property values, reduced operational costs, and increased demand from socially responsible tenants and investors.
Current state of sustainable real estate in the UK:
The commitment to sustainability in the property market is continuing to grow. Sustainable building practices involve using energy-efficient materials, reducing waste, and minimising the carbon footprint of buildings. The UK Green Building Council estimates that the built environment accounts for approximately 25% of the UK’s carbon emissions. By implementing sustainable building practices, the carbon footprint of buildings can be significantly reduced. This is especially important as the UK government aims to reach net-zero emissions by 2050.
Green building certifications:
Green building certifications, such as BREEAM and LEED, provide a standardized framework for assessing the sustainability of buildings. These certifications are becoming increasingly important in the UK property market, with many investors and tenants looking for sustainable buildings that meet these standards.
Government schemes and incentives:
The UK government has also introduced various schemes and incentives, such as the Green Homes Grant and the Net Zero Innovation Portfolio, to encourage sustainable building practices in the property market. The Green Homes Grant scheme, for example, provides up to £5,000 in vouchers for energy-efficient home improvements, including insulation, double glazing, and low-carbon heating.
Benefits of sustainable buildings:
Sustainable buildings are also financially beneficial, with a higher property value and reduced operational costs. The value of sustainable buildings is 10% higher than non-sustainable buildings, according to a study by the Royal Institution of Chartered Surveyors. Furthermore, sustainable buildings can reduce operational costs by up to 30%, leading to higher profits for property owners and investors.
According to a survey conducted by the UNEP FI, REALPAC, and Bentall Kennedy, 93% of real estate investors now take into account ESG criteria when making investment decisions. The survey also revealed that 83% of investors have observed a rise in investor demand for sustainability disclosure. This demonstrates the importance of sustainability in the property market and its potential to drive long-term value.
Challenges of sustainable real estate:
Despite the benefits of sustainable real estate, there are still challenges to overcome. One of the main challenges is the cost of implementing sustainable building practices. Sustainable building materials and technologies can be more expensive than traditional materials, which can make it difficult for developers to justify the cost. However, the long-term financial benefits of sustainable buildings, such as increased property value and reduced operational costs, can outweigh the initial investment.
Another challenge is the lack of awareness and knowledge about sustainable building practices. Many property owners and developers may not be aware of the benefits of sustainable buildings or may not have the knowledge and expertise to implement sustainable building practices. Education and awareness-raising efforts can help overcome this challenge and encourage more property owners and developers to adopt sustainable building practices.
Finally, there is a need for greater standardisation and regulation of sustainable building practices. While green building certifications provide a framework for assessing sustainability, there is still a lack of consistency and standardisation in the industry. Clear regulations and guidelines can help ensure that sustainable building practices are consistently implemented and monitored.
While there are still challenges to overcome, the demand for sustainable buildings is growing rapidly. As the UK property market continues to prioritise sustainability, it is expected that sustainable real estate will become the norm rather than the exception.