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Sustainable New Homes

publication date: Jul 30, 2010
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eco houseEnergy used in the home accounts for 27 per cent of UK carbon emissions – a pretty large slice. So with the Climate Change Act (2008) requiring an 80 per cent decrease in CO2 emissions by 2050, there’s real pressure on housebuilders to achieve greater levels of energy efficiency in their newbuild developments.

However, although Building Regulations have been updated over the past ten years – for example increasing the required levels of insulation and double glazing – they don’t demand zero carbon housing. Far from it; there’s still no requirement for renewable energy, for instance. And though the Code for Sustainable Homes has made a big difference – with energy efficiency levels well above Building Regulations – it’s only mandatory where public sector funding is involved.


The larger housing developers have mainly adopted sustainable housing as an aim. Bovis, for instance, has embraced sustainability, as has Barratt Developments. Barratt’s CEO, Mark Clare, has said, “There is no doubt that there will need to be significant changes in the way that homes are constructed to meet ever higher environmental standards.” Many of the major housebuilders are now using the Code for Sustainable Homes, generally aiming at level 3 or 4.

Smaller builders are not doing so well – with the exception of a few specialists. That’s partly because they don’t have the financial resources of the larger companies, and can’t afford to sponsor research and development of new building techniques.

Jim Cornick of Ecos Trust, which is involved in sustainable development and refurbishment, says, “We’re still quite a long way off target when you compare standards here to the standards used on the Continent - and the quality of building is also a problem” He believes the UK is ten to fifteen years behind.

Builders are going to have to sharpen up their act as regulations get tighter. Rob Pannell of the Zero Carbon Hub says, “Fundamentally the government has set out a timeline to deliver zero carbon homes. The first part of their journey was this year with a new set of Building Regulations that increase the efficiency of buildings by 25 per cent.” But there will be a big step change in 2013 with a 44 per cent increase in efficiency, and then again in 2016 when all new build will be required to have zero carbon impact. A further difficulty comes from the fact that the assessment methods for new buildings have already changed several times. For instance the Code for Sustainable Homes replaced the BRE Eco Homes standard as the assessment method for new homes in 2007, while the SAP energy rating system was overhauled in 2006; it originally scored houses from 1 to 120, while the new system offers ratings from 1 to 100.

That’s confusing for the consumer, but has also led to regulatory uncertainty for developers who have seen the goalposts moved while they have been negotiating the planning process.


Pannell believes most housebuilders are dragging their feet, because building to higher standards of sustainability has higher costs. Some estimates put the costs at £10-15,000 per unit and it’s debatable whether this can be recovered in the selling price. “Because of the extra cost,” he says, “housebuilders will only move when they are compelled to by legislation.”

There is also the difficulty of achieving critical mass. Dan Bridgett, head of external affairs at housebuilder Barratt Developments, says, “To look to build a true zero carbon development, you really need at least 200 units.”

Barratt’s Hanham Hall development near Bristol, with 195 homes is able to use a community biomass Combined Heat and Power plant to provide energy to the whole community; that’s the heart of its zero carbon promise, precluding the need for less efficient micro-renewable solutions.

Early flagship eco-development BedZed, in the London borough of Sutton, shows how the true carbon neutral development has to go further than simply insulating houses well and adding a few turbines or photovoltaic panels. The mixture of housing types, integrated live/work space, and transport planning was intended to allow residents to live an entirely sustainable lifestyle.

Estate agents may not see the most interesting sustainable developments, though, as with very few exceptions it’s the public sector that is making the running in eco-friendly housebuilding. That has been the case since the early days – the Peabody Trust, for instance, a leading housing foundation in London, was behind the BedZed experiment. Rob Pannell says that’s partly due to regulatory pressure. “The requirements for public sector and Registered Social Landlord owned rented housing are ahead of the private sector in terms of pushing the specifications,” he explains. “Most RSLs are now required to build to Code Level 3 or 4.”

Code for Sustainable HomesHowever he expresses concern that the private rented sector is falling far behind. “Fuel poverty is the biggest concern,” he says; tenants pay some of the highest prices for energy, and are unable to improve the properties in which they live. Because the money to support higher feed-in tariffs and the Renewable Heat Incentive will come from energy companies’ funds, not from central government coffers, it’s likely that energy costs will rise – and it’s tenants who are likely to have to bear the brunt of it.


One of the major difficulties in moving the industry forward is the scarcity of skills. For instance, Rob Pannell says, one common CHP system has to be installed by engineers from Denmark; there’s no one in the UK who is qualified to fit it. “Specialist areas are still very specialist, we really need to widen our skills base.”

This applies just as much to architects and planners as it does to builders. The relevant skills are still, often, the possession of ‘eco specialists’, while general builders and most property professionals have a limited knowledge of the issues.

Jim Cornick agrees that there’s a big skills gap. “It’s not only the standards that are important, it’s the practicalities of the building industry that need to be considered.” For instance, insulation is sometimes installed but the builder leaves gaps around the window reveals – exactly where heat loss is most likely to occur. “In terms of the longer curve,” he says, “yes, the standards are going up, but we also need to increase the quality.”


Many housebuilders will need to change their standard designs. Not a simple job, says Gavin Hodgson of BRE; “It is more cost effective to design homes to be Code compliant from the outset, rather than upgrade existing designs.” That’s where Barratt’s ‘Green House’ on the BRE Innovation Park in Watford scores. Mark Clare, CEO of Barratt, points out that, “the most exciting aspect of the ‘Green House’ is that it’s not designed as a one-off – we’ll take what works and apply it to house building across the country.” But for housebuilders to rework their set of standard designs will take time and money.

It’s interesting that ‘green’ houses and the ‘regular’ designs differ markedly. Many sustainable designs are funky and modernist, asserting their difference, but regular designs are far more traditional. No one is prepared to say so explicitly, but the impression is that the sustainable buildings are selling to homebuyers who are making a statement and are keen to have a house that underlines their individuality.


Marketing appears to be the soft spot for sustainable design. Most agents appear profoundly uninterested in sustainability issues – those that do have some expertise are generally those with large commercial practices. One agent that proudly displayed information on sustainability issues on its web site proved to know little about them in practice; apparently the web content comes from a freelance writer and sustainability “is nice to know about but not very relevant to our clients”.

Mark ClareRob Pannell says housebuyers currently don’t consider sustainability as one of the criteria for a purchase. He says one developer offered solar thermal panels as an option; not one buyer took them up, and a year later, the developer decided to discontinue the offer.

That seems to be common experience across the industry. Dan Bridgett, proud as he is of Barratt’s green credentials, says “Sustainability is not the most important selling point. Obviously location and design are further up the list. Consumers aren’t proactively looking for sustainability.”

However, he believes that sustainable building still delivers competitive advantage for housebuilders, but in terms of the supply side rather than demand. Consumers may not pay any more for a ‘green’ house than they would for a normal property, but local authorities and public bodies which own large land holdings and influence the planning process are placing a high importance on sustainability.

That’s borne out by the example of BedZed, which didn’t come up with the highest cash bid for the council-owned land, but still won the deal. The borough valuer agreed that the council could sell land at less than its market value if the benefits to the borough outweighed the monetary loss.


Consumers’ desire for sustainable housing could also change as new incentives come into play. Rob Pannell says the new, higher feed-in tariffs for householders selling electricity to the grid, together with the RHI that comes into force next year, will dramatically change the picture.

“Now there’s an opportunity for home owners to generate income through using renewables,” says Rob Pannell, “That might change things.”

One developer, Forbes of Kingennie, is already using the RHI to market its homes at the Kingennie Fields development in Angus. According to agents CKD Galbraith, all the homes are supplied with ground source heat pumps, and could earn the owners up to £41,000 over 23 years in income from the RHI.

Rob Pannell also believes there has been a valuation issue holding back the development of sustainable housing. Most valuers have refused to include renewable energy sources such as photovoltaic panels in their valuations. So a householder who is considering spending £10-15,000 on solar panels would see none of that value reflected in the price of the house – and a buyer would find mortgage lenders unwilling to advance money on the full price. That does now look like changing, Rob Pannell says.

Hanham HallEven though sustainability is definitely on the agenda in a way it wasn’t, say, ten years ago, it seems that developers and estate agents still have a lot of catching up to do. Few estate agents have any expertise in ‘green’ issues and while regulations now force new homes to be energy rated (giving a nil rating if the requirements are not fully met), this isn’t generally information which is highlighted to potential purchasers. As long as that’s the case, demand for sustainability will come from regulatory bodies and the government, not from consumers.


It is apparent though, that there is a small but undeniably interesting niche for higher quality sustainable housing.

Developers such as Bioregional Quintain, with its One Brighton development, have shown that there is a market there. But ask most green developers and you’ll be told they have difficulty finding agents who are willing to take on the sale of sustainable housing.

There are a couple of web sites which enable developers and homeowners to list eco homes for sale, such as Green Moves, sponsored by the Ecology Building Society, and whatgreenhome, which reviews sustainable housing developments around the world, but no true ‘eco agents’. Perhaps that’s a niche waiting for the right smart operator to take advantage of it.

rooftop allotmentsRooftop allotments? Good heavens!

One Brighton is a pretty swish – but relatively inexpensive – mixed use development comprising 172 studios, one and two bedroom apartments, office and community space in the New England Quarter next to Brighton station.

It is one of the UK’s most environmentally advanced residential developments and it’s setting the benchmark for sustainable living in the UK, designed to follow the ten guiding principle principles of One Planet Living, ensuring that the properties are part of an environmentally advanced development where residents will benefit from happier, healthier lifestyles.

Residents at One Brighton enjoy several unique features; roof top allotments and balcony planters are an integral part of the development where residents are encouraged to grow their own veg. A rainwater harvesting system provides ample irrigation and for the outdoorsy types there are sky and roof gardens and a brand new square.

Prices start from £185,000 for a one bedroom apartment and £249,950 for a two bedroom apartment.