With the government keen to reach net zero targets by 2050, making eco-friendly adjustments to rental properties to reach a C-grade EPC has never been more important. 

Landlords who upgrade their homes to boost energy efficiency will attract tenants hoping to decrease their carbon footprint, as these homes help tenants use up fewer energy sources. 

In the current market reaching these targets is a challenge for many landlords, particularly as specific guidance on how to reach these objectives has not yet been announced by the Government.

Here we explain what the Government’s energy efficiency targets are and weigh in on the likelihood of landlords reaching these ahead of the deadline.

The Government’s targets and challenges

The Government set out plans for all new tenancies in the private rented sector to have an EPC rating of a ‘C’ by 2025. While these changes will be extended to all tenancies in the sector by 2028.

Depending on the current energy efficiency rating, the age of the building, and the type of property the landlord owns, the amount of work and funding that is required to get it up to scratch will vary.

The Government proposed the improvements necessary to meet these targets are likely to cost up to £10,000. However, with labour and the cost of materials at an all-time high, this estimate may be unrealistic.

In an analysis of data from the English Housing Survey, Propertymark forecast that 40% of privately rented homes in England will not achieve the ‘C’ grade energy efficiency rating. According to research eight years up until 2020, privately rented homes with a C grade EPC went from 19% to 39%.

If the growth continues at this previous rate, Propertymark anticipates only 60% of privately rented homes will achieve this rating by 2028.

The National Residential Landlords Association (NRLA) urge the government to provide a package of fiscal measures to help landlords invest in the energy efficiency of their properties. 

In addition to this, the NRLA is calling for better clarity on the dates to reach these targets as well as clarification on when a response to the Improving the energy performance of privately rented homes consultation will be released. 

Landlord sentiment surrounding energy targets

Shawbrook Bank's Confronting the EPC Challenge whitepaper helps understand landlord sentiment surrounding the EPC targets.

The details show 23% of landlords own properties rated D or less. The figure could also be higher as a further 27% revealed they were unaware of their EPC rating.

Many landlords (37%) would like incentives and better borrowing rates to meet the 2025 deadline. In addition to this, 47% called for more guidance surrounding the EPC changes.

As information emerges landlords must stay up to date and take initiative by preparing their homes. An excellent starting point would be to get a new EPC carried out by a professional. This will detail, recommended improvements to achieve a better rating as well as the possible rating if changes are made.

Here at Avery Estate Agents, we operate in Weston Super-Mare and Worle. To find out how we can assist you on your lettings and sales journey, please get in touch with us.

If you would like an idea of what your home could be worth on the current market, why not check out our free and instant online valuation tool.