‘Enforced refurbishment’ could be new headache for future homebuyers

Future homes in Malta are set for major climate-driven price increases after MEPs approved draft rules that will make the EU’s Energy Performance Directive more onerous in a bid to make construction more energy-efficient.

Ahead of the vote this week, the Nationalist candidate for Europe, Peter Agius, warned that new rules for wall, floor and ceiling insulation as well as smart lighting and solar panels becoming the standard, could raise the price of a three-bedroom apartment by €36,000.

All Maltese MEPs voted against the draft rules proposed by Irish Green MEP Ciaran Cuffe, which narrowly secured a mandate, and will now be negotiated in the Council of Ministers.

However, industry experts also believe the long-term vision of the Energy Performance Directive will benefit construction in general in Malta.

The Malta Chamber of Construction Management has been founded on improving the construction industry, and one of the pillars is quality.

“The performance of buildings affects the quality of life of inhabitants and contributes highly to the wellbeing of the occupants,” said Fabrizio Gerada from the newly set-up Malta Chamber of Construction Management. “While quality tends to cost more than poor products, it also reduces the operational costs of a building, such as energy consumption, improves the speed of projects, meaning fewer inconveniences to neighbours, and also makes it easier for traders to install their M&E (mechanical and electrical) systems, which reduces prices from that aspect.”

While property costs are expected to grow due to stricter compliance on energy performance, the MCCM insists that in the long run, such additional costs will be recovered through lower energy bills. “How long it will take to recover those costs also depends on the short, medium and long-term plans of the property buyer... in Malta’s case, the target is to keep houses cool, so any energy uses should be kept to a minimum.”

Gerada added that decarbonisation measures were being welcomed in an age where even banks and lenders want to ensure properties of the future can be resold in the case of mortgage defaults.

The draft rules would require all new buildings to be zero-emission from 2028, with the deadline for new buildings occupied, operated or owned by public authorities in 2026. All new buildings should be equipped with solar technologies by 2028, where technically suitable and economically feasible, while residential buildings undergoing major renovation have until 2032.

All Malta’s MEPs voted against the proposed amendment – Labour MEPs went against the socialist drift, while David Casa’s centre-right EPP was split down the middle on the vote.

Labour MEP Alfred Sant said the costly measures would affect homeowners negatively, even though he praised the EU’s objective to create a highly energy-efficient building stock that is carbon-free.

“The social consequences, according to the various home-owning cultures and structures in the EU, should have been thoroughly considered. This was not properly done. European Parliament negotiators tried to take into account the needs of vulnerable and single-parent households, social housing as well as of rural and remote areas, but they ignored too many essential considerations for these exposed sectors,” Sant said.

According to the European Commission, buildings in the European Union are responsible for 40% of energy consumption and 36% of greenhouse gas emissions. The European Commission adopted a legislative proposal to revise the Energy Performance of Buildings Directive (EPBD), as part of the so-called ‘Fit for 55’ package.

Sant said the energy performance of buildings was a very sensitive social issue, and that the common denominator approach has “blithely attached the major costs for change to ordinary citizens” on the grounds of climate ambition.

“The obligations are not realistic and achievable,” Sant said, calling for a more moederation positio that can incentivise homeowners to improve their property energy performance, rather than be penalised.

Labour MEP Alex Agius Saliba also echoed Sant’s stance, saying it would be “crazy” to ignore the realities of members states like Malta, whose geographical limitations also dictate a different dimension as well as different building practices.

“It is right to be ambitious on the environment... but it is crazy that the European Parliament inflicts greater burdens onto new owners, especially youths seeking to buy their first property... I believe the European Parliament draft laws proposed are a big disadvantage to Maltese consumers.”

The PN candidate for Europe, Peter Agius, earlier this week warned that the radical shake-up in the way properties are built in Malta would require wall, floor and ceiling insulation as well as smart lighting and solar panels to become the standard, suggesting added compliance costs could raise the price of a three-bedroom apartment by €36,000.

Agius said that by 2028, the extra costs would comprise €5,000 in thermal and double-glazing, €3,000 in smart lighting, €6,000 in solar panels and €3,000 for a heat pump, €8,000 in wall insulation, and €11,000 in ground and ceiling insulation. “As a country, it is in our interest to be part of the fight against climate change. Initial capital investments in property improvements will be offset in due time, however, we must be vigilant not to pass on the full cost of climate change on the upcoming generations,” Agius said.

Residential buildings have to achieve, at a minimum, energy performance class E by 2030, and D by 2033 – on a scale going from A to G, the latter corresponding to the 15% worst-performing buildings in the national stock of a member state.

Non-residential and public buildings would have to achieve the same ratings by 2027 and 2030 respectively.

The upgrade in energy performance, which can take the form of insulation works or improvement in the heating system, would take place when a building is sold or undergoes a major renovation or, if it is being rented, when a new contract is signed.

Member states have to present national renovation plans that also include support schemes to facilitate access to grants and funding.

They can also exclude buildings protected for their special architectural or historical merit, technical buildings, buildings used temporarily, and churches and places of worship. Member states may also exempt public social housing, where renovations would lead to rent increases that cannot be compensated by savings on energy bills.