Detached homes face the biggest energy costs due to lack of efficiency and in need of upgrades as we face a rise in the fuel energy cap.

With the rise in the energy cap there are 15 million homes that can benefit from energy efficiency upgrades, according to Halifax, with detached homes facing the biggest rise in energy costs.

Flats are the most efficient type of property that meet the EPC rating of at least C whereas only 10% of pre-1900 homes meet this standard.

During lockdown home movers wanted more indoor and outdoor space sending house prices higher for detached and period homes yet you will spend more to live in colder homes with the rising energy cap.

For older homeowners you can consider ways of raising extra money such as equity release using a lifetime mortgage and invest in energy efficiency upgrades to help reduce the monthly cost of living.

Energy efficient homes increasing

Standards for construction have improved over the decades pushing energy efficiency upwards with homes built since 2012 averaging B or higher when the average for England and Wales is D.

Out of the 25 million homes in England and Wales around 60% of 15 million need to make improvements to meet the minimum EPC of C.

If you want a modern high energy efficient home but these are more expensive, buying a new house with equity release would allow you to trade up without the need to make interest payments.

This table from Halifax shows the percentage of properties at energy efficiency grade 'C' and the average EPC rating in England and Wales for different periods.

Period	Efficiency grade 'C'	EPC Rating
2012 Onwards	97.5%	B
1983 to 2011	63.0%	C
1930 to 1982	27.6%	D
1900 to 1929	11.1%	D
Pre 1900	11.8%	E

There are 4.2 million homes built before 1900 with an average EPC rating of only E and only 12% have an EPC rating of C which improves over time to 27% between 1930 to 1982.

This increased to 63% of properties with C rating from 1983 to 2011 and improved further to 97.5% with this rating for homes built after 2012.

With equity release you can access cash for a specific reason such as making your home more efficient using low energy bulbs, loft and draft insulation, new boiler and controls or heat exchanger.

These improvements are an investment as buyers are prepared to pay a ‘green home premium’ worth as much as £40,000 between the lowest EPC rating of G and the highest of A.

If you have an interest only mortgage and nearing the end of the term, you can replace this with a lifetime mortgage and release more cash to make energy efficient home improvements.

Improving construction methods

The approach to building new homes is very different to older properties in the way they deal with dampness and this has a significant improvement to the energy efficiency.

Older properties deal with moisture with ventilation between floors and ceilings and under roofs resulting in heat loss whereas modern homes use damp-proofing under solid block floors.

Poor heat retention in older properties can be due to single glazed windows, no insulation in floors, walls or ceilings, open fires and poor construction of doors and windows causing draughts.

If you are planning to make improvements to increase energy efficiency of your home you can use equity release with an initial lump sum and drawdown cash over time only paying interest when you use the reserve.

See how much lump sum and drawdown reserve you can have using a lifetime mortgage to improve your home at this link:
Equity release calculator with instant results and figures to access drawdown.

About a quarter of heat loss from older homes is the roof, a third from the walls, a quarter from doors and windows and the rest through the floors.

Poorly insulated homes are most likely to be detached houses with only 19% of homes in England with an EPR rating of C compared to 30% of terraced houses and 56% of flats.

What are your next steps?

Talk to our London City Mortgage advisers if you intend to make home improvements using a lifetime mortgage. We can manage the application from the start to the provider valuation and offer.

Find out more about lowest provider rates and the amounts you can access from your property with this link:
Free equity release quote with interest rates and products to access cash.

Our expert advisers can recommend the lifetime mortgage product for your home improvement. Learn more by using the equity release calculator, property value tracker chart and mortgage costs calculator.