The cost of building green residential developments could be up to 12.5% higher than conventional homes according to a research carried out by property advisors CBRE Hamptons International.

The report compared the standard costs of construction for a 12-storey, 50 unit development totaling around 8000 m2 with a theoretical zero-carbon development of the same size which included features such as combined heat and power, a sky garden, natural ventilation and lighting and energy efficient appliances.

Using standard build costs it was found that a zero carbon flat of around 60 m2 would cost over £13 000 more than a more conventional unit.

The report concluded that while the stamp duty exemption for zero-carbon homes could help offset this extra cost, it was insufficient and does nothing to address green developments that fall short of the zero carbon standard.

“The buyer of a green 60 m2 flat in London will see an increased cost of £13,400. If this flat were to be valued at £200,000, the tax duty exemption would only total £2,000, and the buyer will have to absorb approximately 85% of the premium,” the report said. However, the same flat in a more affluent area of London, costing £400,000, would see a stamp duty exemption of £12,000, leaving the buyer to pay only 10% of the green premium.

Source

Building Sustainable Design