Many landlords who do not want to commit to high levels of expenditure to improve the energy efficiency of their homes, may soon be putting their properties up for sale.
That’s the belief of Gavin Perrett, director at Hawkhurst Invest, a property investment consultancy based in Essex.
The Westminster government has yet to respond to a consultation it held in 2020 on how to boost rental sector energy efficiency, but a draft strategy includes a ‘preferred policy scenario’ for new tenancies to have an EPC rating of C or above by 2025, extending to all tenancies by 2028.
Perrett says some landlords including accidental landlords, people with property investments who are reaching retirement age, and small landlords may simply not be prepared to take on the additional investment to bring their property portfolio up to standard.
“Those landlords are likely to put their properties on the market for a quick sale. Property sales are currently completing in around 150 days, which is quick, so they may choose to sell up now to extract their equity rather than commit to the long term” he says.
And he adds that with rental units coming onto the market for quick sales, investors could secure new properties quickly, and even at lower than market rates to secure quick sales for vendors.
“For renters there is a benefit too as the quality of properties will improve over the long term. With improved energy efficiency and lower running costs, which at a time when inflation, interest rates, and the cost of living are rising quickly, having an energy efficient home is a clear benefit” adds Perrett.
He continues: “As property standards are improved landlords are likely to be able to command higher rent and therefore a higher rental yield. Some landlords will lose out as they decide to sell, possible below market value, and for tenants they could be paying higher rents, but for properties that have been upgraded to a higher standard."
He concludes by reminding landlords that listed buildings have some flexibility. Owners of these will have to consult their local planning departments. There may be exceptions if improvements to properties change the fabric or appearance of the property
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This is the whole point of the pointless and ridiculous epc
Buy property cheap from the private sector landlords , destroy the working and middle class
That’s why the government don’t bother building new property, they’ll take yours off you using legislation , uncontrolled immigration guarantees huge demand despite a dwindling native population due to various recent issues …
Any thing below a C is not going to make top money, but if the capital gain is less then so is the CGT payable, swings and roundabouts
NO NEED TO PANIC it looks like only one Tenant to deal with, turn off all lights on way out no other person left in the property to need light or work for home.
Repetition repetition post, wind up post now that’s easy the eggs are getting harder to suck. Pass, have a nice day.
Don’t make me laugh 😹, “ quick” sale they say…. Nope, I am just going to be selling them at one a year, that is not quick. I will also not be selling to other landlords at a discount 🤔🤔 why would I when we have thousands of first time buyers ready to offer ? This article has something’s correct, but the idea we are all running to the exit in a panic is nonsense, I have until 2028/2029 to sell my portfolio, more than enough time, and I agree with Tricia that that long and winding post on upgrading some 1950’s semi looks like a builders advert 🤠🤠. I am more than happy to sell at full market prices to grateful FTB’s.
I am an EPC Assessor. I have a small portfolio of 11. One of my homes was an E. It was a concrete poured 50s property. Only a 1 bed semi bungalow. BUT the cost to externally wrap was over 10k! And that price was 2years ago. I sold it this year. It was not worth the expenditure on a rent of 600pcm. It would have only reached a C without even further investment. Also people talk about the refinancing of portfolios. Justvto be clear banks are not lending as much on forward advances etc unless the rents are upto date with current market. Most of mine are 200pcm behind as of last year due to the sharp increases. So we were not lent as much ! Where do the government think the funds are going to come from?
Shelley, may I ask, are you permitted to carry out and issue an EPC on your own properties?
How on earth they got a B with an old property is beyond me , spent a small fortune on 5 separate ones and best I could get was a C
Inclined to think its a load of baloney
My property was a D 10 years ago and only needed a new boiler , which was done to be graded C. !0 years on and they moved the goal posts. Still graded a D and needs insulation of the concrete floor, install a heat pump, install solar panels. Total cost over £30k, total annual savings just over £100. They are a joke. Sold the house.
Installing a heat pump reduces the EPC because it is powered by electricity!
EPC are a joke all of my tenants have never asked for one
Different EPC assessors got different results for the same house ??
The Lights kill switch is a non-starter So he goes out for the night for 4 hours at the pub, kills all the lights which are LED's say 5 watts each and say 5 rooms that is 25 watts per hour so time 25 x 4 total power a saved is 100 watts which is one-tenth of a unit (1 Kwatt) so at 17.36p per KW (on my last bill) the guy is saving nearly 2p BIG WOOP its simple maths it the high power and the things on standby that you got to look out for.
By the way, a contactor which you would use to control a mains supply is about £15.. plus wiring routing of the wire, plus electrician (£100)
So he saves 2p a day this os when the electric company most charge 25p or more a day for the meter in the house just sitting there
As above they keep messing about with the EPC calculation. I can't trust my 2015 certificate. I can't be bothered to get a new one it will just show it's worse than the E rating. I'm just selling.
Nick - you’re right of course, sometimes you just have to accept that you’re flogging a dead horse 🐎, and move on. The government of the future will be less than impressed with this ‘ shower’, when they are picking up the mess from the failure of the PRS, but as landlords we can only be concerned for our own future, and that of our family.
Agreed.
Just received this email and planning to partake in the study:
The Department for Business, Energy and Industrial Strategy (BEIS) is inviting you to take part in an important piece of research with landlords and agents about regulations on energy efficiency for private lettings.
We are offering £70 as a thank you to people who participate in a 45-minute telephone discussion. Research interviews will take place between now and the end of October.
Why am I being contacted?
You, or an agent acting on your behalf, has registered one of your rental properties for an exemption under the regulations on energy efficiency for private lettings introduced in 2018. As part of this process, consent was given to be re-contacted for research. There is no obligation to take part in any further research but we would be interested in hearing your views if you are willing to share them.
We are particularly interested in hearing from landlords who have registered an exemption on their EPC domestic rental property and who are renting as a company. Please do get in touch if this applies to you and you'd like to participate or just learn more about the research.
Who is conducting this research:
This research is being carried out on behalf of BEIS by us, Kantar Public (an independent research agency) and we are working in partnership with ICF, an independent consultancy specialising in policy work.
Your participation is completely voluntary, anonymous and confidential. The researcher who you would talk to is independent from BEIS and nothing you say will be shared with BEIS in a way that will identify you without your consent.
What to do if you are interested in taking part?
If you are interested in taking part in the research, please reply to this email with your preferred contact telephone number - please note that not everyone who receives this letter will be contacted so please do get in touch if you're interested in being involved.
You do not need to know anything about the regulations to take part in this research. We are only asking for your own views and opinions.
Have some questions?
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