Homes with heat pumps demand a 59 per cent premium compared to regional averages, according to research from property firm Savills.

The latest analysis reveals the disparity between how homes are heated in rural and urban locations, and across different house price bands.

It comes as households across the UK have seen a significant jump in household bills, and the government is encouraging a switch to low-carbon alternatives before 2035 as part of its plan to cut Britain's reliance on fossil fuel heating.

Savills survey of home buyers revealed that 71 per cent of respondents consider EPC ratings to be important in their decision making. With almost a third (32 per cent) stating that they place more importance on EPC ratings than they did a year ago.

At the same time, 59 per cent said that they would be willing to pay more for a home if at least 75 per cent of a property's energy was powered by renewable sources.

Analysis of average values of homes transacted between 2019 and 2021 shows that newer, cleaner, methods of energy do demand a higher price tag.

Properties utilising community heating schemes* demand the highest average prices (£550,673), followed by homes supplied by heat pumps (£483,935). This is closely followed by homes that use oil (£419,490), which is likely driven by larger country properties that have oil Agas fitted.

Across England and Wales, homes with heat pumps fitted demand the highest premium compared with the regional average - with buyers paying on average 59 per cent more for the offer of cleaner energy. This premium is most acute in the South East, with homes on average 84 per cent more expensive.

Heat pumps are predicted to become the main source of low carbon heating for new homes, as the government sets out ambitions of installing 600,000 heat pumps a year by 2028.

Lawrence Bowles, Savills residential research analyst, said: "It's no great surprise that the vast majority of homes still use mains gas heating, but faced with increasing energy prices, homes that offer more cost-efficient monthly alternatives - such as homes with heat pumps - are climbing higher up buyers wish lists when searching for a new home.

"However, our analysis shows that more environmentally friendly heating methods such as heat pumps and community heating systems are most prevalent in higher-value areas. As such, in many areas housing values would not necessarily support the investment in newer and cleaner forms of heating.

"It also highlights the enormous challenge set by the zero-carbon agenda targets and the uphill battle ahead that we face. While government subsidy will undoubtedly go some way in supporting people to reduce their homes' environmental footprint, more resources and investment is needed to significantly reduce our reliance on fossil fuel heating."