Industry Comment
Privately rented homes are a ready market for
electric heating Chris Stammers (pictured), Marketing Director at Dimplex, explores why the private rental sector could be the key for wholesalers to drive sales of electric heating appliances.
I
n 2013, the private rented sector overtook the social rented sector for the first time to become the second largest
tenure in England. With factors including reduced pressure on housebuilders to build affordable homes and a booming buy-to-let mortgage market – which now exceeds £200billion in lending – the trend continues. It is clear that there is a huge pool of private
landlords in the UK and an even higher number of private rented properties; around four million – but what does this mean for electrical wholesalers? To see the opportunity, you also need to understand the make-up of this private rented market. According to the last available Census data, just 56 per cent of people living in rented accommodation live in a house, compared to 91 per cent of owner occupied residents; the remainder live in flats or apartments. The Government’s English Housing Survey 2012-13 shows that single occupants aged under 60 make up almost a quarter of all private rented sector households, while in 2012, the private rented sector had the lowest proportion of homes with gas central heating at 81 per cent. They also had the lowest energy efficiency (SAP rating) of all tenures since records began in 1996.
All of this paints a picture of small, inefficient homes fuelled by outdated, ineffective heating systems – especially flats, where gas supply is often not available. It explains the high penetration of electric heating in privately rented homes, and highlights the need for investment. Too many private rented homes are heated by outdated or incorrectly specified appliances, even if it means tenants are paying over the odds for their bills. And therein lies the opportunity for wholesalers. Like many sectors, legislation is already forcing
change. From April 2016, landlords must consider any request from tenants to improve the energy efficiency of their property. After January 2018, properties must have an EPC (Energy Performance Certificate) rating of ‘E’ or above if they are to be rented out and DCLG estimates that nearly 70 per cent of all electrically heated properties would get an EPC benefit by upgrading to a newer electric system. Landlords who have spent years neglecting
their properties in pursuit of higher profits will be forced to spend – and with heating accounting for more than 60 per cent of energy in the home, it’s the obvious place to start making improvements. Wholesalers and their customers must react
to this demand and make sure they have the stock, knowledge and understanding to sell accordingly. Work with your manufacturer of
choice to gain a thorough understanding of innovative solutions like Dimplex Quantum and promote their benefits; remember electric heating systems will only be cost-effective if they are specified correctly. For example, many private tenants continue to
live with outdated storage heaters – in fact, there are around two million homes with storage heaters in need of replacement in the UK. In some cases, or in individual rooms, electric
radiators such as the highly intelligent Dimplex Q-Rad can offer a viable solution, delivering controllable heat at the touch of a button. However, it is important to specify the right heating system to match the lifestyle of the user – and many tenants will find a system comprising only direct acting panel heaters will cost them significantly more to run than storage heating.
Wholesalers must understand this, working with customers to deliver the right solution – and with a full range of electric heating appliances, Dimplex is well placed to offer advice. The Dimplex Quantum system, for example,
gives users the chance to store energy during cheaper, off-peak periods and use it when they need it, through the day. It is up to 47 per cent cheaper to run than an electric convector or radiator system and could save up to £975 per year running costs when compared to an electric radiator-only system. Even when savings are passed onto the tenant, these kind of figures simply cannot be ignored. In summary, electric heating will continue to
drive sales across all sectors. With continued pressure to reduce the UK’s carbon emissions, further innovation from manufacturers and an increasing understanding of energy efficiency, demand will come from domestic and commercial sectors, spanning owner occupied, social rent and private rent tenures. However, spotting opportunities for growth is as important now for electrical wholesalers as it always has been. That’s why privately rented homes could be the key to unlocking sales potential.
www.dimplex.co.uk www.ewnews.co.uk 2016 electrical wholesaler | 29
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