Energy renovation: DPE, what do we do now?

For several months now, the real estate world has been in a panic over rising interest rates and the supposedly correlated drop in prices. Another current phenomenon is also to blame: the new rules regarding the Energy Performance Certificate, or "EPC."

The EPC: A mandatory document

The EPC must be presented when selling or renting an apartment. It informs the future owner or tenant about the energy consumption of the property, as well as the efficiency of its heating, air conditioning, and domestic hot water systems.

Although it has existed since 2006 (stemming from the Kyoto Protocol), the EPC has been making headlines since its 2021 reform. And for good reason: as part of the fight against substandard housing and energy poverty, renting out properties rated G, F, and E—known as "thermal sieves"—will be prohibited starting in 2025 (class G), 2028 (class F), and 2034 (class E), respectively. Since 2022, rents for class F and G properties have also been frozen.

This measure is pushing some owners of F and G-rated properties to renovate, but the ban on renting out thermal sieves has also resulted in a decrease in rental supply within an already strained rental market.

How should you handle a poor EPC rating?

"It's a buying opportunity!"

Buying a property with a poor EPC rating can turn out to be a great opportunity, provided you manage the renovation workeffectively. Here are a few tips:

1. By managing the renovation work, you can improve the rating by about 2 or 3 categories (from G to D, for example). Many criteria come into play, not just double glazing. In a Haussmann-style building with individual heating, for instance, ensure you have recent double glazing, self-regulating ventilation (like a VMC system), a modern and efficient water heater, induction cooktops, and gentle-heat or inertia electric radiators, and you will achieve an E or D rating. It is difficult to get a better rating than D in Haussmann-style housing unless you insulate all the walls, at the risk of losing a certain amount of square footage.

2. It is a buying opportunity. Many owners of "thermal sieves" fear for the future liquidity of their property, and landlords are no longer allowed to increase rents. They either lack the funds or are simply afraid to undertake the work themselves, so they are looking to sell. And since "fixer-upper" apartments scare off many buyers, and the stock of such apartments is increasing, great negotiations are possible. It is not uncommon to negotiate a price 15% to 20% lower than the asking price for a property in need of renovation. 

3. It is important to properly manage the work undertaken. When you resell, you will have a new EPC carried out. The professional conducting the assessment will ask for information (construction materials, insulation, equipment specifications) and proof (photos, invoices). If you do not have these, they will be forced to provide a more conservative rating. 

Seize the opportunities

In short, don't be afraid of the energy performance rating (DPE); let others worry about it and use it as an opportunity to secure a great deal.

By mastering the subject from start to finish, you will buy low, increase the value of your property, sell high, live in it comfortably (acoustic and thermal comfort, air renewal), and incidentally, do a great service to both the property and the planet.

If you would like support, call on Maison Kyka. Our expertise: renovating and optimizing the energy performance of your future home.