Rental homes by 2030 will require an EPC rating C
For rental homes, the new Labour government outlined its plans in 2024.
Energy Performance Certificate (EPC) ratings of C will be required for all rental properties by 2030 in order to "lift up to half a million households out of fuel poverty" compared to the current minimum EPC standard of E.
In addition to reducing energy costs, these measures are part of the government's Plan for Change strategy.
More details about how this will be accomplished have been shared in the past week.
These energy-efficiency standards will be able to be met in a variety of ways by landlords. Energy-saving measures include installing or improving insulation and double glazing. According to estimates, tenants could save £240 a year on energy bills.
There will also be an improved "cost cap" for landlords of £15,000 per home, up from the previously proposed cap of £10,000. Grants like the Boiler Upgrade Scheme are available to landlords as part of government support.
An estimated 3 million rental homes will need to be upgraded to meet a C rating
The benefits of going greener at home include things like lower energy bills, and a reduced carbon footprint. But the pathway to a greener home can be complex, with cost remaining the biggest barrier to people who’re thinking about making changes.
The Rightmove Greener Homes Report, takes an in-depth look at people’s feelings about, as well as the progress being made towards greener, more sustainable housing.
Its analysis shows that 2.9 million rental homes need to be upgraded if they’re to meet the revised government target of a ‘C’ Energy Performance Certificate (EPC) rating by 2030.
In its survey, Rightmove asked landlords how they felt about the upcoming government targets. Half of them (50%) said that they’re concerned about the possibility of fines being imposed if they’re unable to make the changes within the current timeframe.
This could mean that some landlords may decide to sell their properties ahead of the 2030 deadline. And for those that do make the changes, they could end up passing these costs onto their tenants through rent increases.
Property expert, Tim Bannister, said: “In the rental market, through discussions with agents and our research, we know landlords want to provide comfortable, energy-efficient homes, but green upgrades can be costly. For landlords of lower-value properties, financial returns may not always justify the investment.”
How can households upgrade to be more environmentally friendly?
As part of Labour's Warmer Homes Plan, £6.6 billion will be allocated to upgrading homes ranked below a C. However, this does not come close to the £23.4 billion needed to upgrade existing rental homes.
As part of the Rightmove Green Homes Report, it highlighted some measures that would help towards meeting these targets. These measures would benefit tenants and landlords alike. Some of these include:
Creating grants or low-interest, long-term loans to enable home-owners and landlords in the 'mass market' to make green upgrades. In its research, it found that homes under £400,000 are the least likely to be equipped with green upgrades
In the year when energy-efficiency improvements are made, landlords may deduct the costs against their income tax rather than against their capital gains tax
Incentives for green improvements made by a new buyer within the first few years after purchase. Having suggested this change last year, we still think it could be effective in motivating people to change their behavior
Continually encouraging mortgage lenders to invest in green mortgage innovation, so that new products and awareness of them are available to a broader audience.