Are New Builds Efficient At Reducing Energy Costs?

The UK is currently preparing for an unprecedented rise in energy bills, with many households left to work out how they will be able to cover these rising costs. A key selling point of new-build properties has long since been their alleged efficiency when it comes to energy bills but to what extent is this true? New research from Unlatch shows the differences in energy savings between new-build properties and existing households.

Looking at the average annual energy bill for existing home and new-builds in England and Wales, Unlatch also assessed what these bills would look like after being faced with a 54% increase in energy bills. As it stands, the average existing household pays £825 annually in energy costs; new-builds, on the other hand, pay just £401. However, both existing homes and new-build properties are going to feel the pinch of a 54% increase.

With the proposed new increase in energy bills, existing homes are set to see a £633 increase (resulting in £1,457 annually) whereas the average new-build homeowner will most likely see a £312 increase (£713 annually). This means that home builders and architects need to look for more creative ways to save energy.

Where are we seeing the biggest energy cost savings?

There are certain regions of the United Kingdom in which new-build properties are seeing even more cost efficiency than other areas. For example, in Wales, new-build homes are £440 cheaper annually (climbing to £804 after the 54% increase).

Other areas, including the West Midlands and East Midlands, are also seeing considerably greater savings (£439 and £425, respectively). New-builds in the South West, North West and Yorkshire and Humber are also seeing savings of around £400 or more than existing properties.

From these figures, it is clear that the reputation of new-build homes saving a large amount of money when it comes to energy prices clearly has merit. Lee Martin, Head of Unlatch UK says that these savings make the higher upfront cost of new-build houses “well worth (it)”.

Low energy efficiency standards are costing consumers

The decision to allow homes to be built with low standards of energy efficiency has proved to be costly, costing owners of new homes approximately £234m in 2021.

Although the Labour government aimed to introduce the zero-carbon homes standard back in 2016, the decision was scrapped by the Conservative government in 2015. Since then, as a consequence, there have been nearly 1.2 million new homes built with energy efficiency standards which are far below what they should be to combat greenhouse gas emissions.

Not only are new-build properties better at an environmental level, but they also, as we have seen above, can lead to greater ongoing savings for homeowners. According to the Liberal Democrats, each home operating under the zero-carbon standard could expect to have an energy bill saving of around £200 annually. This means that since 2016, owners of newly built homes could have saved a cumulative cost of around £790m.