0:03 AM, 25th September 2023, About A year ago 30
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Most UK landlords had already prepared for the government’s planned energy performance certificate (EPC) legislation, which was scrapped last week by the Prime Minister Rishi Sunak.
The legislation 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.
Now, a study by Shawbrook Bank using its internal data has found that 80% of landlords said they were already prepared for the 2025 EPC deadline.
Of these, 30% said their rental properties already had an EPC rating of A-C, while 50% said they had plans in place to improve their EPC rating before 2025.
Emma Cox, the managing director of real estate at Shawbrook Bank, said: “Scrapping the impending EPC regulations might free up capital in the short term for landlords who haven’t yet invested in improving the energy rating of their properties.
“But while policies shift, climate change is going nowhere, and energy efficient buildings will remain central to Net Zero plans.”
She added: “Rules might not be changing as soon as 2025, but professional landlords with modern, energy efficient stock will be in the best position to attract tenants, as well as reduce potential voids, and importantly, be prepared for future legislative change.”
The study also found that 17% of landlords said they were not prepared and had no plans to improve their EPC rating, while 3% said they had not heard of the regulation.
And nearly half (46%) of landlords had spent between £500 and £20,000 on improving or investing in their property in the last year, with the average amount being £25,148.
This figure rose to £37,164 for London-based landlords.
A fifth (20%) of landlords said that the cost of labour for property improvements was a key concern for them over the next six months, while 16% said EPC regulations were a concern.
The study also showed that the proposed regulations had influenced many landlords to be more energy conscious when buying new properties, with 28% prioritising newer, more energy efficient properties in the next six months.
And when landlords were asked about their views on previous rumours of the initial EPC deadline being moved to 2028, the study found that 31% of landlords said it would give them more breathing space to complete improvements across their portfolio, while 29% said they would progress with their improvement plans regardless.
The study comes at a time when landlords are facing lower profits than ever before, due to tax changes, rising costs and regulatory pressures.
According to the National Residential Landlords Association, landlord profits are at their lowest level in 16 years.
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Anthony Mellery-Pratt
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Sign Up9:55 AM, 26th September 2023, About A year ago
Whilst most landlords appreciate that a better EPC rating gets better tenants and higher rents, surely you should be addressing the stupidity of the current epc assessments - installing an air sourced heat pump will damage your rating.
Please put some pressure on the powers that be to address this problem and come up with a modern relevant basis that is fit for the current situation. We will then be able to make improvements that really are beneficial rather than being a tick- box exercise. This is something where the RICS should be taking a lead.
Seething Landlord
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Sign Up11:33 AM, 26th September 2023, About A year ago
Reply to the comment left by Anthony Mellery-Pratt at 26/09/2023 - 09:55
Gove has admitted that the current EPC rating system is not fit for purpose, which might well have been one of the reasons for the delay in responding to the consultation on the MEES proposals that have now been abandoned.
Ian Narbeth
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Sign Up12:52 PM, 26th September 2023, About A year ago
Reply to the comment left by Crouchender at 25/09/2023 - 20:29
The problem with the Government trailing for months and months that an EPC of C would be mandatory (subject to your Council granting an exemption) is that prudent landlords have to react. Suppose everyone waited and did nothing. The regulations come in. Even if D-Day is some time off, there would be the most enormous rush to get work done. Guess what? The costs would rise dramatically and the time to get a contractor in would lengthen. So whatever figure the Govt mandated as having to be spend would only go half as far. Couple that with the threat of life-changing fines that wipe out years of profit and you have a recipe for disaster.
TheMaluka
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Sign Up13:30 PM, 26th September 2023, About A year ago
Reply to the comment left by Ian Narbeth at 26/09/2023 - 12:52
I feel that a recipe for disaster is just what the government wants for the PRS.
Contango
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Sign Up7:50 AM, 30th September 2023, About A year ago
Weve done a lot spending literally millions on boiler upgrades insulation lighting updradesand in some cases external wall insulation but even so on country properties beyond scope of gas we get whipped for ultra efficient LPG condensing boilers. At the time EPCs recommended condensing boilers and we did it which is why we ought not to be penalised for the lack of heat pumps. To retrofit them now would involve tearing up hardwood floors for larger piping. There needs to be an extended amnesty because the guidance under EPCs wherefollowedneed to live out their. Service lives.
Electric heating is still penalised on EPC so the whole thing is not fit for purpose. I agree with those who prefer heat loss measurement in real life. Yes the tests will be more expensive but of much more use. LPG if not sold is just flared off so it is actually highly environmentally efficient to deploy a fairly clean fuel which would otherwise just be burnt off
Laurie
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Sign Up13:17 PM, 30th September 2023, About A year ago
Reply to the comment left by Sam at 25/09/2023 - 10:54
That’s because it’s obviously an unrepresentative survey and designed to give the conclusion the CEO of Shawbrooks wanted (her statement is typical eco warrior talk). My Shawbrooks mortgages have doubled in the last year, where does the money come from to make these extremely costly upgrades for Victorian properties. Another virtue signaling CEO who doesn’t suffer from the policies she would like forced on landlords and ultimately tenants.
Michael Holmes
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Sign Up10:11 AM, 1st October 2023, About A year ago
I am just wondering what will happen when the underlying assumptions concerning CO2 emissions being harmful are finally debunked and the whole house of cards come tumbling down. Mass formation psychosis is not a very good way to run a country.
TheMaluka
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Sign Up12:50 PM, 1st October 2023, About A year ago
Reply to the comment left by Michael Holmes at 01/10/2023 - 10:11
I would be interested to see your evidence that CO2 emissions are not harmful.
JamesB
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Sign Up19:22 PM, 1st October 2023, About A year ago
Nobody asked me, but in fairness I was "planning"....
I sold a really nice Victorian terrace earlier this year because I had not long since refurbished it to a high standard, but it was only an epc D because I had to visit a family member in hospital on the day of the inspection, somebody else let them in, and the inspector was a moron that didn't even bring a ladder to check for loft insulation so "assumed none"??? and wouldn't accept that the walls now had insulated plasterboard without receipts, despite it being pretty obvious to anybody with eyes.
To be honest I just want to sell my remaining 7 London buy to let houses and leave the game for somebody else to play because quite clearly once they are all Cs they will turn the screws again and make the requirement B or A. Everything in my portfolio is larger character Victorian houses that don't need mutilating.
On top of that, my own house is a 7000 sq feet, 1850s build, with an inaccurate EPC of F. I will have enough trouble with that when they eventually start messing with owner occupiers, if they make it through the 8 foot high gates. No amount of planning is going to make this one easy.
Laurie
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Sign Up4:56 AM, 2nd October 2023, About A year ago
Reply to the comment left by TheMaluka at 01/10/2023 - 12:50
CO2 is a greenhouse gas, but makes up such a small percentage of the atmosphere (0.04%) that it has a very insignificant effect on the climate. CO2 is plant food, we should be a lot more worried about lower CO2 than higher at this time, around 0.02% will see many plants die.