The landlords' guide to retrofitting

How investing in green technology can increase your property value and save you money

In the ever-evolving landscape of property management, landlords are continually seeking ways to enhance their properties, both to attract tenants and to increase their bottom line. 

Retrofitting with green technology has emerged as a win-win solution, offering the potential to boost your property value while also saving on running costs, and split these savings with tenants.

Upgrading the energy efficiency of a property is also important from a compliance perspective; MEES regulations prohibit landlords from leasing a building with an EPC below an E, so getting your property up to scratch can be essential.

In this guide, we delve into the specifics of retrofitting, exploring the options with the best return on investment (ROI), available grants and funding options, and the potential savings you could take advantage of…

Which retrofitting options give the most value?

When it comes to retrofitting for energy efficiency and sustainability, landlords have a plethora of options to choose from. However, when looking at the total value of all benefits, not all retrofitting projects offer the same level of payback.

Here are some of the top contenders:

LED Lighting Upgrades: One of the simplest and most cost-effective retrofitting options is upgrading to energy-efficient LED lighting. LED bulbs consume significantly less energy and have a longer lifespan compared to traditional incandescent bulbs, offering quick returns on investment through reduced electricity bills and lower maintenance costs.

Insulation Improvements: Enhancing insulation in properties can lead to substantial energy savings by minimising heat loss during winter and heat gain during summer. This can be achieved through measures such as installing double-glazed windows, adding insulation to walls and roofs, and sealing air leaks. While the upfront costs may be higher, the long-term savings and improved comfort for tenants make insulation upgrades a worthwhile investment.

Heating System Upgrades: Household heating is one of the biggest energy consumers, and therefore one of the highest household bills. Upgrading to an energy-efficient heating system (or even better, a renewable heating system) coupled with installing smart thermostats can yield significant savings on energy bills, while also adding value to your property. 

Solar Panel Installation: While solar panels require a higher initial investment, they offer substantial long-term benefits. Solar energy can offset electricity costs, generate additional income through feed-in tariffs, and increase property value by appealing to environmentally conscious tenants.

What grants and funding options are available?

Landlords looking to upgrade their properties with green technologies have access to various grants and funding options aimed at promoting energy efficiency and sustainability, including:

Energy Company Obligation (ECO): The Energy Company Obligation is an energy efficiency scheme that obliges larger energy suppliers to fund energy-saving measures in domestic properties. Under ECO, landlords may be eligible for funding to install insulation, heating upgrades, and other energy-saving improvements for their rental properties. ECO funding is typically targeted at low-income households and those living in fuel poverty.

Renewable Heat Incentive (RHI): The Renewable Heat Incentive is a government scheme that provides financial incentives to homeowners, landlords, and businesses that install renewable heating systems, such as biomass boilers, heat pumps, and solar thermal panels. Through the RHI, participants receive quarterly payments for seven years based on the amount of renewable heat generated by their systems.

Replacement of Domestic Item Relief: Landlords may be able to claim tax relief through the government's Replacement of Domestic Item Relief, which provides tax relief on the cost of replacing furnishings in rental properties with more energy-efficient alternatives.

Local Authority Grants and Schemes: Many local authorities across the UK offer grants, loans, and incentives for energy efficiency upgrades, including those targeted specifically at landlords. These programs vary by region, so landlords should check with their local council to see what funding opportunities are available in their area.

Green Finance Initiatives: Some financial institutions offer green finance products, such as green loans or mortgages, specifically designed to support energy-efficient retrofitting projects. These products may offer favourable terms, including lower interest rates or longer repayment periods, to incentivise landlords to invest in green technologies.

It's important for landlords to research and explore all available grants and funding options to determine which ones best suit their needs and circumstances. Additionally, eligibility criteria, application processes, and funding availability may vary over time, so staying informed about updates and changes to these schemes is crucial.

How much could I save?

The potential savings from retrofitting with green technology can vary depending on factors such as the size of the property, current energy usage, and the extent of the upgrades. However, studies have shown that landlords stand to reap substantial financial benefits over time:

Energy Cost Savings: By implementing energy-efficient retrofits, landlords can significantly reduce energy consumption and, consequently, lower utility bills. The exact savings will depend on factors such as the efficiency of the upgrades and local energy prices but can amount to hundreds or even thousands of dollars annually.

Increased Property Value: Retrofitting with green technology can enhance the marketability and value of a property. Energy-efficient buildings typically command higher rents and sale prices, as they offer reduced operating costs and appeal to environmentally conscious tenants and buyers.

Maintenance and Repair Savings: Green retrofits often entail installing durable, high-quality materials and systems that require less frequent maintenance and repair. This can translate to additional savings over the long term, as landlords spend less on upkeep and replacements.

How GreenVal can help

If you’re interested in retrofitting your rental property, GreenVal is the ideal place to start. Offering a range of features designed to help you make informed decisions about green technology integration. 

Some of the key benefits include creating a detailed business case, outlining the costs and benefits associated with incorporating green technology into your property, as well as gaining insight into your property's resilience through factors like thermal comfort, air quality and financial stability. 

GreenVal enables homeowners to obtain quotes from leading accredited national suppliers, ensuring competitive prices for green technology installations like solar panels, electric vehicle charging points and heat pumps, as well as recommendations for low-cost and do-it-yourself improvement opportunities.

In conclusion, retrofitting with green technology presents a compelling opportunity for landlords to increase their property value, attract tenants, and achieve significant cost savings.

By carefully selecting retrofitting options with favourable ROI, exploring available grants and funding options, and calculating potential savings, you can head towards a more sustainable and profitable future for your properties.

Head to GreenVal to get your own property energy efficiency report, as well as quotes for upgrades.