I like data. Sad perhaps, but I tend to think it is more use than wishful thinking and I trust it rather than the words of politicians – although I admit that isn’t much of a hurdle!
So I thought I’d share with you some data on the energy assessment market in 2009. Let me know if you find it useful and I’ll make sure we issue updated information as and when we can.
Alternatively, as they say on the Saturday night news, if you would prefer not to know the scores, now is the time to look away.
The headline figures for the total number of reports of the various types lodged on the Landmark register for England & Wales during the 2009 calendar year are as follows:
|Report type||Total Registered in 2009|
|RDSAP EPC (existing homes)||1,987,479|
|SAP EPC (new build homes)||147,350|
|ND EPC (non-dwellings)||111,312|
|DEC (operational ratings)||27,727|
The most striking feature is just how large a percentage of the total number of reports are RDSAP EPC – almost 90% of all reports registered were RDSAP EPC for existing homes.
Of course there are several different markets for RDSAP EPC dependent on the purpose for which the EPC is required. The most important purposes are ‘marketed sales’, ‘private rental’ and ‘social rental’.
The other options are ‘non-marketed sales’ and ‘not sale or rental’. The former is generally associated with a social landlord selling a property through a stock transfer or under right-to-buy. The ‘not sale or rental’ purpose is intended for voluntary EPC i.e. those issued for a homeowner who just wants reliable, expert advice on how to reduce their energy waste.
The graph below shows how many RDSAP EPC were registered against these purposes each week during 2009.
The totals for each purpose are as follows:
|RDSAP EPC Purpose||Total Registered in 2009|
|Not Sale or Rental||5,790|
No, I know, the total doesn’t match exactly. Apparently the difference arises primarily because of reports being cancelled or re-issued. That sounds reasonable, but I harbour a suspicion that databases never give the same answer to a question twice – the ghost in the machine likes to keep us on our toes…
Leaving aside my paranoia, what jumps out at me from this data and from the graph is (a) how important private rental EPC were – accounting for over 35% of all RDSAP EPC registered; and (b) it is a declining market.
Looking at the graph, Private Rental EPC lodgements declined from a peak of over 20,000 EPC in the week commencing 26th January 2009, to less than 9,000 in week commencing 30th November 2009. A decline of more than 50%.
It is almost inevitable that this trend is going to continue. EPC issued for private rental purposes are valid for 10 years and is required on the first change of tenant since rental EPC were introduced in autumn 2008.
Improving compliance would help; as would implementing CLG’s suggestion of extending the requirement for an EPC to homes in multiple occupation, which are currently – bizarrely – exempt. But there is little reason to expect that this market will do anything other than continue to shrink.
Conversely, the data shows just how depressed the housing market was last year.
Thanks to HIPs we know that there is a very high level of compliance in the housing marketed sales sector. So the number of marketed sales EPC registered is going to be very good indication of the total number of homes listed for sale during the year.
To put this in context, data from Land Registry shows that the average number of homes sold each year during the period 2004 to 2007 was in excess of 1.1 million. We also know from broader industry data that somewhere between a quarter and a third of properties listed are withdrawn from the market for one reason or another.
This is why the estimates for the number of property listings – and therefore demand for HIPs, HCR (remember them…?) and EPC – being made a few years ago were in the range 1.3 million to 1.8 million.
It’s an awful long way from what we saw last year.
However, it does give rise to the hope that as the housing market begins to recover, we could actually see an increase in demand for EPC – despite the inexorable decline in demand for private rental EPC.
We don’t yet have any data on the total number of marketed sales lodgements over the first eight weeks of 2010. But looking at lodgements by NHER members, the housing market has got off to a brighter start than I had feared given the combination of weather, political bickering and economic news we’ve been subjected to. Indeed there were more marketed sales EPC lodged last week than we have seen in months – indeed throughout the whole of 2009 there was just one week (in June) when more were lodged.
It’s not the first cuckoo, but it does suggest that the long dark nights of a near-death housing market are starting to shorten. Hopefully we’ll see some real signs of the market starting to spring back to life over the next few months.
We’ll keep you posted.