The proposed new RICS Residential Retrofit Standard

The Royal Institute of Chartered Surveyors (RICS) has released a new draft Residential Retrofit Standard for surveyors, with the aim of "revolutionising" retrofitting practices in the UK.

The consultation is a response to feedback gathered by RICS in its last Residential Market Survey, which indicated that energy efficient homes are more desirable and valuable.  Retrofitting existing housing stock with energy efficient measures (EEMs) is a key part of reaching the Government's net-zero target and the publication of a new Standard aimed specifically at this issue reflects the profession's vital role in reaching this goal and the scope of the task ahead. According to RICS, an estimated 25 million homes in the UK will require some form of energy improvement work.  The move is particularly well-timed as the demand for retrofit advice is increasing in light of high energy prices.

RICS' consultation on the new standard is open until 12 September 2023 and can be found here.  RICS has not yet confirmed when the new Standard will come into force, if approved.  After the consultation, responses will be reviewed by the Expert Working Group (in which RPC is involved) and be redrafted where needed.

When will the new Standard apply?

RICS Professional Standards set mandatory and good practice guidelines for surveyors' ethics and technical competence and are relied upon in regulatory proceedings as well as being relevant to civil claims.

The new Standard is intended as a framework for professional advice on energy efficiency home improvements, including in home surveys and secured lending valuations.  It is particularly aimed at surveyors providing retrofit services to the residential market, including as the lead professional on a project, assessor, designer, contract administrator or post-retrofit inspector.  Retrofit services are defined as including advice on the installation of EEMs and other matters associated with improving energy efficiency, reducing carbon emissions, protecting the building’s fabric and contributing to occupants’ well-being in the dwelling.

Although the Standard recognises that EEMs will change over time as technology advances, it currently envisages that the following works are likely to fall within the scope of the new Standard:

• Carrying out repairs prior to the installation of EEMs;
• Improving levels of insulation and air-tightness;
• Managing moisture in the dwelling, including preventing weather resistance;
• Improving the supply of ventilation in the dwelling (if required), indoor air quality (IAQ) and managing hazards such as Volatile Organic Compounds (VOCs);
• Installing efficient heating and cooling systems and reducing the risks of overheating;
• Provision of efficient water heating and lighting systems and other equipment and appliances; and
• Installing efficient energy control, metering and monitoring systems and Low/Zero Carbon technologies.

The aim is for such works to lead to reductions in energy use, improve internal comfort including internal air quality, eliminate condensation (e.g. by reducing thermal bridging) and issues arising, improve sustainability, flood risk resilience, fire protection and protection of architectural and historical heritage and features.

What are the key requirements of the new Standard?

The emphasis of the new Standard is on ensuring that any retrofit of a dwelling is appropriate for the property and the client, which will require surveyors to exercise their professional judgment since there is an enormous range in the size, nature and location of properties across the UK that will require retrofit works. 

Surveyors will already be familiar with many of the requirements set out in the Standard, such as the need to agree clear terms of engagement in advance; to ensure that one has the right expertise to deliver the services; to be familiar with properties of the same nature as the subject property and the local area; and to ensure any equipment used (for example, to measure condensation) is properly maintained and used in accordance with the manufacturer's guidance.

Surveyors offering retrofit services must be well versed in the differences between the types of service available and be able to identify the advantages and disadvantages of each option so that the client is in a position to make an informed choice on how to proceed (see section 2.5 of the new Standard). This is particularly importance because many clients are unlikely to be familiar with the range of options available.  Data gathered by RICS indicates that 36% of homeowners would not know how to go about making their homes more environmentally friendly. Advice must be property-specific and clearly understandable to the client.

At the outset of the engagement, information should be gathered from the owner and occupiers (see section 3.3) regarding any previous works (including EEMs), the current energy performance of the property, either in the form of an EPC or other energy or assessment model results, if available, such as IAQ test results and copies of energy bills. Surveyors should also enquire whether any previous insurance claims have been made and whether there are any circumstances that might complicate or hinder the installation of EEMs, such as the presence of Japanese knotweed or a protected species. As mentioned above, repairs may need to be carried out prior to commencement of the EEM works, particularly if the property is affected by structural movement, inappropriate previous repairs (e.g. the use of cement-based pointing or render over lime), condensation, water penetration, leaks, fungal decay, wood-boring insect attacks, mould or inadequate ventilation systems.

Subject to the terms of engagement, surveyors involved in retrofit projects must:

• Inspect the property at all relevant stages of the works, and produce an accurate and comprehensive record of the state of the property at each inspection.
• Pay special attention to measures that will help prevent effects such as thermal-bridging, water penetration, moisture accumulation, reduction of internal air quality, poor ventilation, overheating and unnecessary heat loss.
• Be able to identify and advise on defects and deficiencies caused by inappropriate energy efficiency measures implemented at the subject property and advise on the energy assessment of the dwelling.
• Be alert to defects or concealed property elements that could affect the retrofit service, such as deteriorated mortar joints to the external leaf of a cavity wall possibly affecting inadequately galvanised steel wall ties. Where such defects or features are identified, they should recommend further investigation by a suitably qualified person.

Approach the assessment and design of EEM measures holistically, bearing in mind the occupants' practices and lifestyles.

The new Standard is comprehensive and contains a typical retrofit process, as well as detailed guidance (at 4.3.2) setting out what should be considered, documented or done, depending on the role the surveyor has agreed to undertake.

Appendix A will be particularly key as this contains technical considerations for a typical residential property retrofit projects and lists the specific issues that should be considered.

This is also an area of practice where safety hazards will be particularly relevant, since EEMs can negatively impact air quality and lead to radon exposure for example.  Appendix D sets out common safety hazards typically encountered in dwellings such as mould growth and exposure to VOCs.

Key takeaways

Due to the importance of EEMs and their effect on a property's value and desirability, surveyors carrying out residential work should ensure that they familiarise themselves with the new Standard, even if they do not intend to undertake standalone retrofit projects. This would include surveyors carrying out homebuyer surveys and mortgage valuations.

Surveyors should ensure that they only agree to provide residential retrofit services if they have a good understanding of EEMs and are familiar with relevant guidance and legislation, including PAS. The new Standard states (at Appendix A) that providing residential EEM retrofit services requires significant knowledge, understanding, skill and competence and that the requirements for such services will present a significant challenge to the design and surveying professions and the construction industry, given current and anticipated skill levels: "unless careful attention is paid to the necessary detail at all stages of the project, significant, costly and potentially hazardous defects will be built into thousands of UK homes, with resultant negative effects on occupiers’ well-being".   A challenging financial climate drives more civil claims, so this is not an area where work should be undertaken lightly.

Of course, providing advice on EEMs is something RICS expects when carrying out a homebuyer survey (see RICS commentary about the new Standard), so all surveyors advising on residential properties will need to have some familiarity with common EEMs.  There is certainly demand for such advice (RICS found that 78% of respondents would find it helpful if their surveyor could offer retrofitting advice when purchasing a property), but it will be difficult to provide detailed advice within the constraints of a standard survey and valuation.  It would be sensible to ensure that your terms of engagement are clear that you will not be providing detailed advice on EEMs unless specifically instructed to do so.

It will also continue to be important to be clear (not only in your own mind but also in your written agreement with the client) about which role you will be undertaking.  Particularly in smaller projects, "mission creep" is a real risk, which can result in the assumption of a greater responsibility than first envisaged (and quoted for) and make defending a complaint or claim more difficult. In particular, ensure that the terms of engagement are clear about whether you will be inspecting the property during the works and, if so, at what stages.

The new Standard recognises at 4.6 that advice on EEMs may change over time as global and regional legislation and practice and the property itself evolves.  This introduces an element of risk as practices evolve over time, so surveyors should be mindful of the risk of criticism for recommending an out of-date alteration or, conversely, failing to recommend a newer measure.  Keeping up-to-date with developments in this area will therefore be key to avoiding any claims on this basis, as will ensuring that any recommendations made are backed by evidence of their efficacy.