Your Business and Industry
Maintaining a balanced EPC view
In recent weeks we’ve seen some important changes to the proposed introduction of increased Minimum Energy Efficiency Standards for rental properties.
Original proposals set out that all tenanted properties in England would need to have an EPC rating of at least band C from 2028 (new tenancies requiring this from 2025).
However, a further announcement from the Prime Minister in late September has backtracked on this, although landlords are still being encouraged to get their properties up to a C rating ‘where they can’.
Of course, many landlords have already actioned energy-efficient upgrades individual properties within their portfolios and made significant investments along the way.
This was clear in the Q3 2023 Landlord Panel research from BVA BDRC – in conjunction with Foundation Home Loans – which showed that 64% of landlords have carried out works in response to new energy efficiency requirements. Most of which have either carried out works at the minimum cost to comply and continued to let out the property (34%) or have carried out works to maximise its long-term value (35%). Only a minority have carried out works and then sold their property (2%) with 12% not having carried out any works and leaving the private rental sector altogether.
In response to the government U-turn, landlords had largely positive or neutral reactions to this announcement. When posed the question - what impact, if any, do you think Rishi Sunak’s recent announcement on changes to the government’s green commitments will have on your business and portfolio plans? The most cited response was that it ‘had no/very little impact’ (29%). Tellingly, the second most cited response (at 12%) was ‘being able to stay in the UK rental market’.
What’s important for landlords and intermediaries to remember is that this could change again, particularly if Labour win the next General Election. Therefore, we should not be moving forward under the impression that this decision to raise minimum EPC levels to C and above is now dead in the water.
It remains a careful balancing act for landlords, and for those looking for that extra bit of support: there are lenders – such as Foundation Home Loans – out there who remain committed to providing a range of green options to support them on their energy efficiency journey.
Take a look at our green mortgages
FOR INTERMEDIARIES ONLY
