The article summarizes “Report on Building Renovation Technical and Economic Barriers in 5 Pilot Countries and in CEE” written by Tartu Regional Energy Agency (TREA). The full report can be accessed here.
Summary
This report identifies technical and economic barriers to building renovation in Central and Eastern Europe (CEE) and provides policy recommendations to address these issues.
The report integrates results from an expert survey conducted in spring 2024 across five CEE countries: Croatia, Estonia, Poland, Romania, and Slovenia. Further input from national renovation experts contributes insights up to the end of 2024. The project partners’ extensive experience in regional renovation initiatives also underpins the analysis.
Barriers
According to the report, financial barriers are the primary obstacles to renovation across all project countries. This includes small grant amounts and high demand leading to quick fund exhaustion, and unpredictable programs. Other challenges include a general lack of awareness about renovation and its benefits, and insufficient funds among homeowners to initiate and carry out renovation activities.
The lack of innovative financial solutions furthermore hinders progress, as these could be more flexible and better suited to overcoming financial barriers for homeowners or addressing other financial obstacles.
Another significant obstacle all project countries (except Estonia) face is the shortage of skilled workers in the renovation sector. In Estonia, Poland, and Croatia, additional challenges include the limited availability of construction companies and the lack of designers specializing in different technical aspects of renovation.
Recommendations
In recognition of the barriers described above, the report outlines three groups of recommendations to make renovation initiatives more effective and inclusive, ultimately improving living conditions for households.
Communication and Awareness of Renovation Benefits & Possibilities
- Raise awareness about available grants and renovation benefits.
- Help homeowners to better understand their building’s true condition and renovation needs.
- Encourage early intervention to avoid costly repairs later.
Effective communication and awareness-raising about the potential benefits of building renovation are crucial. While various grant schemes and financing mechanisms exist, many homeowners are either unaware of them or face bureaucratic hurdles in the application process. Additionally, homeowners often misunderstand their building’s true condition and needs, either underestimating or overestimating required work. If the issues are not addressed early on, the building’s condition can worsen, ultimately making renovation more expensive. On the other hand, if homeowners are overly concerned about potential costs, they may fail to realize that carefully selected interventions can improve both the building’s condition and the well-being of its occupants, often at a manageable cost, especially when prioritizing necessary renovations early, which can prevent more expensive repairs later.
Technical Support and Capacity Building for Renovation
- Improve technical guidance for renovation projects, especially for energy-poor households.
- Establish One-Stop Shop (OSS)-type services to support homeowners throughout the process.
- Enhance the skills of workers, technical experts, and public sector employees in managing renovations.
- Provide training and guidelines to homeowners and building managers to improve renovation outcomes.
Besides grant schemes, technical support for renovation projects should be improved. Many households lack the expertise or confidence to undertake renovation work, making technical guidance essential. One-Stop Shop (OSS)-type services could help overcome these barriers, particularly for energy-poor and vulnerable households. These services would offer targeted support, assisting homeowners throughout the renovation process, and help them access funding.
Addressing the shortage of workers on construction sites is challenging, but the skills of both workers and technical experts must be enhanced. In cases where the administrative burden and lack of staff make managing renovation projects particularly difficult for public entities, awareness and skills can also be raised. However, as identified in some countries, local public officers often struggle with managing a large volume of renovation projects, highlighting the need for additional administrative capacity. Public sector training can also ensure better handling of renovation processes and support for homeowners and tenants.
Moreover, the development of knowledge among homeowners and building managers can be achieved through targeted training and capacity-building initiatives. Providing clear guidelines and technical requirements, alongside practical training on renovation processes and best practices, would further empower stakeholders and improve renovation outcomes.
Financing Solutions for Renovation: Ensuring Accessibility and Flexibility.
- Ensure regular and transparent grant calls for better renovation planning.
- Implement step-by-step renovation approaches with clear objectives for each phase.
- Develop flexible financing options, like green loans, with longer repayment periods.
- Collaborate with banks to improve loan conditions and ensure they are more accessible.
- Tailor financial support to meet diverse household needs, including for lower-value properties.
Long-term improvements in financing mechanisms are crucial to ensure stability and predictability in renovation efforts. Many countries highlighted the importance of regular and transparent grant calls to help homeowners and the renovation sector to plan renovations more effectively. Establishing predictable schedules for grant calls is essential, as it allows better preparation for renovation activities and contributes to more effective workforce planning, potentially mitigating some workforce-related challenges.
To overcome financial barriers, some countries have proposed step-by-step renovation approaches, allowing households to gradually progress with the help of financial support. However, it is important that each phase of the renovation has a clear aim, ensuring that the outcome is understood from the start, to avoid locking out future improvements. Others have suggested flexible financing models, including so-called green loans for deep renovations to achieve energy efficiency or for local renewable energy production systems (in the case of Multi-Apartment Buildings, usually PV plants) with longer repayment periods, making renovations more affordable in the long term. Furthermore, efforts should be made to collaborate with private banks to improve loan conditions and offer more accessible terms.
Likewise, financial support, grant options, and loan options should be tailored to meet diverse household needs. For example, there may be a need to find ways to guarantee loans in areas with lower property values. This can be achieved not only through grants and guarantee mechanisms, but also by working with banks to enhance loan conditions for renovations.
The CEESEN-Bender project has received funding from the European Union’s Programme for the Environment and Climate Action (LIFE 2021-2027) under grant agreement n° LIFE 101120994.