Standard ensures higher quality of domestic retrofit

In March 2024, RICS published the first edition of the Residential retrofit standard in response to increasing demand for retrofit services in the UK.

The professional standard aims to ensure that consumers who are considering retrofitting their homes engage with qualified, regulated professionals.

Together, the standard's requirements and recommendations show residential property surveyors how to implement sustainable working practices, thereby safeguarding the public interest and maintaining high standards in the sector.

To better understand why and how the profession is implementing the standard, Property Journal spoke with Adam Santos FRICS, SDL Surveying's senior regional surveyor for London.

Adam Santos FRICS (AS): As an RICS-regulated residential surveying firm we are all too familiar with the UK's ageing and deteriorating housing stock, and how it limits the country's ability to achieve net-zero carbon by 2050.

A key part of our strategy must involve improving the way homes consume and conserve energy, not only to benefit residents but also lower national energy demand.

Adopting the standard has enabled us to have more comprehensive conversations with clients about these issues, and offer services and products that meet their requirements.

At SDL we are exploring how we can best provide relevant advice to our clients using existing products such as the RICS Home Survey level 2, and also where other forms of reporting could add value.

This might include tools and reports which help consumers understand what retrofitting options are available and the potential impact these could have with respect to energy performance and consumption.

AS: While it is generally aligned with PAS 2035, the RICS standard gives surveyors greater flexibility to tailor the advice they give about energy performance and improvement measures.

In the private sector, retrofit projects are typically led by energy firms through government-supported schemes. The disadvantage of this is that improvement is often limited to just one or two measures and doesn't take a true whole-house approach.

Whole-house retrofits are more common in the social housing sector, which has the budget to make long-term investment in these properties and achieve economies of scale.

Although considering the whole house in the design of retrofit measures is best practice, a PAS 2035 retrofit assessment is arguably beyond what is needed for some applications – for example, installing loft insulation or photovoltaic panels. Where a consumer is funding the improvements themselves, this form of retrofit assessment and advice can be overly bureaucratic and isn't necessarily consumer-friendly.

The flexibility provided by the RICS standard therefore makes it particularly effective in the private sector.

AS: The UK retrofit sector has considerable potential, with around 29m homes requiring significant energy efficiency improvements if the country is to achieve net-zero carbon emissions by 2050 – that amounts to more than 1.1m homes per year.

Retrofit advice has the potential to develop into a large market for surveyors and is therefore a key component of SDL's diversification and growth strategy. 

The standard's flexibility complements that of RICS' Home survey standard in that both allow surveyors to offer bespoke advice considering their customer's budget and expectations.

However, closer integration of these standards by RICS would enhance our ability to advise on domestic energy performance and the best options for improvement, either as part of a home survey or as an additional service that clients could request or be offered.

AS: Given the sheer scale of domestic retrofitting needed to meet national net zero targets, it's vital that works are assessed, designed and managed by professionals with expertise in building pathology, who can provide property-specific advice.

The standard's requirements and best-practice benchmarks contribute significantly to improving the quality of works, which boosts public confidence and investment in retrofitting as a form of home improvement.

For SDL, the standard shows the wider property sector and the public that surveyors have a key role to play in achieving sustainability goals. It also provides us with the framework to develop the services consumers want but that are not being provided at present.

A combination of legislative changes and lender incentives should also see demand for such services grow. For example, government targets which go beyond the proposed changes to the Minimum Energy Efficiency Standards (MEES) in the private sector could incentivise homeowners to make improvements when selling and potentially unlock more affordable mortgage finance options. With the lending sector already well integrated with RICS members for valuation purposes, the Residential retrofit standard will enhance our ability to provide advice and meet that growth in demand.

AS: Although highly skilled at identifying property defects, residential surveyors do not always have the level of knowledge required to assess appropriate remedial works.

For retrofit projects, therefore, it is important that they understand not only what improvements can be made, but how these will interact with the building fabric. This will enable them to consider the positive and negative impacts, and recommend measures appropriate to a client's building and needs.

Surveyors who want to provide suitable advice need a good understanding of modern construction and retrofitting techniques, as well as the consequences of deviating from these for building performance, and the potential for future defects.

At SDL, we have found that developing in-house training programmes and resources has been the best way to upskill our workforce.

We look forward to seeing more resources as the sector develops – such as case studies of successful and unsuccessful retrofits with analysis and lessons – which will benefit not only those wanting to advise on retrofitting but also those providing home surveys.

AS: Although firms that want to increase their market share in this sector still face challenges with funding, consumer incentives and fees, the demand for advice and services presents more opportunities than ever.

Focusing solely on financial payback periods for retrofits – that is, how long it will take for projected energy savings to offset initial investment – is problematic, because the numbers rarely stack up, at least not within an acceptable time frame.

Some homeowners, for example, may not hold on to their property long enough to see financial payback for their investment; however, that investment is easier to justify where other benefits such as improved comfort and health are considered.

Increased energy costs have refocused homebuyers' and occupants' attention on consumption, performance and running costs, as Rightmove's latest Greener homes report indicates.

Where buyers have an abundance of choice, they can and do choose homes that are likely to have lower running costs. Instead of improving their home ahead of sale, though, sellers are more likely to settle for a lower price, allowing buyers to reinvest that saving in the necessary improvements.

While MEES regulations have been cited as one of the reasons landlords are leaving the private rented sector, the reality is more complex, because retrofitted properties can generate higher yields for reinvestment and further improvements.

Support from the able-to-pay market will be critical to kick-start and maintain retrofit at scale. Yet confidence is being undermined by media reports of retrofits gone wrong – of contractors carrying out inappropriate or poorly executed installations, and prioritising profit over homeowners' needs.

Such cases demonstrate the importance of careful retrofit advice that is tailored to a building's structure and occupants, and shows why projects must be checked at multiple stages and have measurable outcomes.

The profession must show consumers and the wider retrofit sector that it is worth paying a premium fee for a premium service from a surveyor – not only to raise the standard of assessments but also to seize the opportunity presented by retrofitting on a national scale.