More Energy Efficient Homes in UK Buy-to-Let Market

Don't miss out on the best new investment deals. Enter your details now to sign up to our mailing list and receive exclusive information straight to your inbox.

Portfolio Landlords Persist with Green Upgrades Despite Government U-Turn

Research from Paragon Bank has found that almost four in ten (37%) of portfolio landlords are pushing forward with energy-efficient upgrades to their property in order to hit EPC C or above. This is despite the Government’s U-turn on proposals to make regulations regarding EPC ratings in the private rental sector more stringent.

They also found that 32% of portfolio landlords already hit C or above across all their properties.

Paragon surveyed 390 landlords with four or more properties in December 2023 to gauge insight into how portfolio landlords approach energy efficiency in 2024. This is after Prime Minister Rishi Sunak announced the scrapping of a proposed introduction of a minimum requirement of an EPC C rating to properties let to new tenants. This would have meant that all new tenancies would have required an EPC rating of C by April 2025, and this rule would have been extended to all tenancies by 2028.

Despite this U-turn, energy efficiency ratings have become a much more significant consideration when buying to let property out in the private sector.

Learn More: See our guides on buy-to-let tax changes and how to buy a second home for more information on the UK rental market.

RWinvest Awards

Only £30,000 Deposit Required

15% deposit secured for next 10 units only!

Energy,Efficiency,Concept,With,Energy,Rating,Chart

Almost 3 in 10 Landlords Expect to Finish Upgrades in 1-2 Years

According to the survey, most landlords undertaking improvement work anticipate completion within one to four years. 28% expect to reach EPC C across their portfolios within 1-2 years, while 22% expect the same result in 3-4 years. 18% expect to finish their upgrades quicker – within the next 12 months. 17% believe it will take them five years or more to hit the EPC C target for all their properties.

However, other landlords showed reluctance in the face of uncertainty surrounding future Government proposals. 15% of those polled by Paragon Bank are postponing green upgrades until legislation requiring EPC C or above is confirmed. One in 10 answered that the potential future proposals have no bearing on their portfolio strategy.

Further Reading: What are the best areas to invest in London? Learn about this and other topics, such as off-plan property and how to make money on buy-to-let investments, with our guides and insights.

Completed, Furnished 2-Bed Apartment in Prime L1

We are now welcoming offers on this city centre property in a previously sold-out development. Get in touch and get your offer in.

Private Rental Sector Outperforms Owner-Occupiers for Energy Efficiency

Data taken from the English Housing Survey shows that 44.9% of properties in the private rental sector have attained an EPC between A and C, while 43.3% of owner-occupiers have achieved the same. 2.18 million PRS properties had reached EPC A-C in 2022, up from 830,000 a decade earlier. As a result, according to their analysis, the energy efficiency of PRS properties now outperforms owner-occupied homes.

Richard Rowntree, Managing Director of Mortgages at Paragon Bank, said: “It’s encouraging to see portfolio landlords continuing to enhance their properties so they meet EPC C or higher, despite the proposed regulations being shelved.

“These landlords will join almost a third more who have carried out sustainability-focused upgrades or purchased property already benefitting from energy-saving technology, highlighting the commitment amongst portfolio landlords to improve the standard of privately rented homes for tenants.”

Find out more about the UK buy-to-let market with our dedicated area guides covering topics such as available investment property in Stoke-on-Trent and buy-to-let property in Battersea.

Author

Jessica Ferris

Jessica is a property content writer at RWinvest. Keeping a close eye on the UK property market, Jessica helps our readers stay informed and up to date on the latest market news and statistics.