Up your green game with the houzen Sustainability Index

The impact of sustainable solutions is crucial - now more than ever. houzen has created a clever way to value sustainability in homes.

Saurabh Saxena, Founder and CEO, houzen | BTR News
Saurabh Saxena, Founder and CEO, houzen.

By Saurabh Saxena, Founder and CEO, houzen

Sustainable solutions are slowly making its way into Build to Rent developments. A recent example is a decision by investment manager – Invesco – to submit its residential property portfolio to the BREEAM In-Use Residential Accreditation program. As a part of its commitment to becoming more sustainable, L&G is also deepening its implementation of an ESG framework into their developments. For example, it has recently introduced an ambitious company-wide target of becoming operationally carbon net zero by 2030 – 20 years ahead of the Government’s own carbon net zero target of 2050.

Build to Rent operators are the shapers of new standards in real estate – as well as local communities. Being aware of the impact of sustainable solutions, in the long run, is crucial – now more than ever. Corporate funds know this and focus more and more on the long-term vision while building and managing new developments. Sustainability features are not just the ‘good to have’ – they become a standard necessity for every new project.

houzen has created a clever way to value sustainability in UK homes. This has specific value for Build to Rent operators and ‘for-sale’ developers.

We follow the ‘generated by AI, verified by experts’ approach which gives us the best of both worlds. houzen uses computer vision, a technology which allows the machine to ‘see’ through pictures, floorplans etc, then ‘identify’ and ‘tag’ i) type of room e.g. bedroom, garage, bathroom, (ii) amenities and appliances e.g. air conditioning, swimming pool, garden, and (iii) quality i.e. all rooms and amenities are rated on a scale of 1 to 5, (iv) special sustainability aspects such as EPC rating, recreational spaces, wellness, natural light, sound and a few others.

Sustainability tools for Build to Rent operators - houzen | BTR News

Developers and Build to Rent operators often look for new ways to differentiate their stock. Interestingly, some of the new buildings are quite eco-friendly, or wellness oriented. Some form of an unbiased rating system focused on sustainability could easily be the single biggest ‘value proposition’ for developers, where – in a post Covid world – homeowners or renters are increasingly becoming more climate focused and spending more time at home. From a financial point of view, a high sustainability rating on homes could easily command a 5% premium on value and/or rental value, an American company ‘pearl certification’ confirms. 

In the UK, houzen is the first company who has come up with sustainability ratings. Since the ratings are done through data, they are unbiased and give sustainable homes a new route to reach investors, buyers and renters. houzen’s algorithm not only delivers the rating, but also creates a simple roadmap of what sustainable changes or refurbishments to make to the home in order to command a higher rating, and what the financial impact of the improved rating would be. houzen has done these ratings on the entire UK home stock and is now starting to issue certificates actively.

houzen have been working with Build to Rent clients since 2017. We understand what Build to Rent companies focus on, what are their goals and how flexible they are – and how have they changed through the years. We have created two very distinct versions of Sustainability Reports: one type for Build to Rent operators and developers, and one for BTL investors. We have different teams of experts working on these, which allows us to provide specific recommendations: Build to Rent reports include not just the interior and exterior of the property, but also the community impact and even details like the type of cleaning materials used by the cleaning companies.