Does improving your EPC rating increase the sale price?
An EPC rating is no longer just a certificate. It is a factor in what buyers will pay and who can buy at all.
The energy performance certificate rates a property from A to G, and the rating is now a factor in the sale price rather than a formality. Buyers have become more conscious of running costs, and investors face minimum standards for letting, which means a poor rating restricts the buyer pool as well as affecting the price.
Not every improvement is worth making before a sale, and the ones that move the rating are not always the ones sellers expect.
The measures that move the rating
The EPC model weights the building fabric heavily, so insulation measures have a disproportionate effect relative to their cost.
- Loft insulation, which is inexpensive and among the most effective measures available
- Cavity wall insulation, where the construction allows it
- Modern glazing, particularly replacing single glazing
- A modern condensing boiler, or a heat pump, with proper heating controls
- Solid wall insulation, which is effective but expensive and disruptive
- Solar panels, which improve the rating and reduce running costs
The measures that do not
Several popular measures have little or no effect on the rating, which means money spent on them is not reflected in the certificate. Draught-proofing, smart meters, low-energy lightbulbs and water-saving devices all fall into this category — they are sensible things to have and they will not change the band.
The commercial case
The return depends on who is likely to buy. An owner-occupier may value a better rating through lower running costs, which is difficult to capitalise into the price. An investor buying to let faces minimum standards, so a rating that is already compliant is worth considerably more to them.
The reliable approach is to obtain a new EPC modelled on the proposed improvements before commissioning the work, so you know which measures will actually move the band. The certificate costs a modest amount and prevents spending thousands on measures that leave the rating unchanged.
Common questions
- Does a better EPC rating increase my property's value?
- It can, particularly for property that will be bought by an investor, because the rating determines whether it can be let. For an owner-occupier the benefit is largely in lower running costs, which is harder to capitalise into the price. The effect is real but usually modest compared with the effect of condition and presentation.
- Which improvements raise an EPC rating most?
- Loft insulation and cavity wall insulation, because the EPC model weights the building fabric heavily. These are also among the cheapest measures available. Modern glazing and a modern boiler also help. Draught-proofing, smart meters and low-energy bulbs have little or no effect on the rating despite being popular.