Majority of landlords expect EPC legislation to return

Landlords believe EPC C targets could be re-introduced by the next Parliament, according to a new survey.

Research by Foundation Home Loans reveals three out of four landlords still expect EPC legislation to be introduced in the future.

The Prime Minister scrapped EPC targets which would have required landlords to ensure their rental properties had a minimum EPC rating of C.

The mooted deadline was 2025 for new tenancies, and by 2028 for all tenancies.

Most landlords believe a future government will re-introduce EPC targets

According to the survey, most landlords were pleased with the government’s decision to put off mandatory EPC targets.

The data reveals that 64% of landlords were satisfied with the decision, rising to 80% for those who own 11-plus properties.

However, more than 75% of landlords believe EPC targets could be re-introduced in the near future.

Grant Hendry, director of sales at Foundation Home Loans, said: “It is interesting to hear that most landlords believe a future government is likely to introduce the minimum EPC levels, which were recently canned by this administration.

“According to the survey, 36% of rental properties have an EPC rating of below C currently, and this landlord cohort tends to believe they will have to improve this, possibly in just over three years time.”

Challenging year in 2023

Despite the concerns about EPC ratings, landlord confidence still remains high.

According to the survey, landlord confidence has improved across all metrics year-on-year, with many feeling confident about the opportunity for capital gains on their properties, and the private rental sector (PRS) as a whole.

However, those with smaller portfolios are more cautious about the future of the PRS.

Mr Hendry adds: “There is a renewed sense of calm and stability from these latest set of landlord results, and while it’s clear there are still some considerable concerns for active participants in the PRS, it’s positive to see confidence generally rising across most of the metrics.

“After a very challenging year in 2023, it’s perhaps not surprising to see landlords being somewhat cautious about what the future might bring, particularly in terms of ongoing finance, but also tenant demand, rental yield, and capital increases.”

Despite the challenges, tenant demand still remains high with 63% of landlords reporting an increase in tenant demand in the last three months.

Regionally, landlords in the North West report the strongest increases in tenant demand, followed by Yorkshire and the Humber.

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