Potential ticking time bomb for retrofit complaints awaits

The term ‘time bomb’ is sometimes overly used in the housing market, and while it has been linked to many things over the years, I fear that when it comes to retrofitting, we are in danger of facing one if something is not done soon.

The Daily Telegraph recently reported that between October 2022 and September last year, 2,171 complaints were logged by Citizens Advice relating to solar installations. A further 1,526 were recorded about insulation products, and another 274 about heat pumps.

Government grants but little oversight

As it stands, there are no regulations around who can retrofit a property – something the Chartered Trading Standards Institute is calling for. So anybody can potentially knock on a homeowner’s door and offer to carry out the work – promising thousands in energy efficiency savings thrown in.

Given there are Government grants to fund such projects, it’s understandable why a homeowner might be persuaded, especially if the grant covers the entire cost of the work.

There has been a significant Government push in recent years to encourage homeowners to undertake energy-efficient upgrades.

The £2bn Green Homes Grant was launched in 2020, followed by the £4bn ECO4 grant scheme in 2022, and most recently, the £1bn Great British Installation Scheme (GBIS), which is still running.

However, as we have seen with spray foam insulation, if the work carried out actually damages the property or needs to be rectified further down the line, it can end up putting the homeowner in a worse position.

Lenders will need assurances

Given the Government is aiming to install around 600,000 heat pumps per year by 2028, we are arguably only at the beginning of the retrofitting task.

It does not bode well however if we are already seeing approximately 300 complaints per year about the installation of heat pumps, especially when you consider the UK is only estimated to have around 412 heat pumps installed per 100,000 people.

Of course, the main concern is that, just as the Government’s PR machine about retrofitting kicks into gear, we will start to see even more complaints about installations, which could bring the whole area into disrepute and risks deterring any interested homeowners from having the work done.

One of the main issues with the heat pumps is that, for them to operate successfully, the installer needs to make sure the house is adequately insulated first – otherwise, the homeowner is going to get mould problems very quickly.

Given the potential for misadvice, this is also going to be an area where mortgage lenders will be closely watching. As we see a greater push towards green mortgages and hope for a larger uptake, there will need to be assurances in place for lenders and borrowers that the improvements they are making to their homes will indeed enhance their value rather than, in the worst-case scenario, decrease it.

Lenders, too, will need firms they can trust to provide the advice and recommendations, but also firms capable of carrying out the work, rather than leaving it to homeowners blindly searching on the internet.

What is being done?

It is for this very reason that we have been invested in and focused on the retrofit sector for some time now, training our surveyors to offer homeowners and lenders professional retrofit advice.

Recently, we also saw the Royal Institution of Chartered Surveyors (RICS) launch a new Residential Retrofit Standard. This standard will provide a framework within which RICS members can advise their customers on retrofit options in homes across the UK – ensuring homeowners receive advice from skilled, regulated professionals.

This will be increasingly important as the interest from homeowners around energy-efficiency gathers pace.

In its recent Residential Property Monitor, RICS asked surveyors if they had seen greater interest from buyers in homes that are more energy-efficient – with 39% saying they had noticed an increase in demand.

Similarly, 43% of respondents stated sellers were looking to attach a premium to homes that are more energy-efficient, while just over a quarter – 26% – of surveyors reported seeing buyers highlight poor energy-efficiency as a reason for making an offer below the asking price.

If we are to see more incentives and funding schemes from the Government – which seems likely – there needs to be some form of protection for homeowners regarding who is allowed to give advice and carry out the work.

Currently, the barriers to entry are so low and legislation so limited it is open to abuse by unscrupulous ‘tradespeople’, and as the sector grows, this will only potentially worsen.

While there has been much focus on the benefits of retrofitting, more attention now needs to be paid to the importance of ensuring the advice and work carried out are of a high standard, and that homeowners’ good intentions are not taken advantage of.





Simon Jackson is managing director at SDL Surveying

First published with Estate Agent Today

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