Green finance for energy efficiency improvements should be paired with meaningful fiscal incentives, including an updated Landlord Energy Saving Allowance, according to Propertymark.

The agents’ body believes the government should allow retrofit costs to be offset against rental profits, enabling energy efficiency works to be recognised for capital gains tax purposes, and exploring stamp duty and council tax incentives linked to verified improvements.

In its response to the consultation into the Warm Homes Fund - to support low- and zero-interest consumer loans - Propertymark says private landlords’ financial position must be fully considered because they don’t directly benefit from lower energy bills after works are completed.

“Without accessible and tailored support, there is a risk that new requirements could push some landlords to sell, reducing the supply of rental homes and further increasing pressure on tenants,” it warns.

Help

The Warm Homes Fund could help by providing low-interest or government-backed loans for smaller landlords, SMEs, mixed-use building owners and community organisations, while repayment terms must be long enough to reflect the cost and lifespan of retrofit works.

It believes property owners need to understand which measures are suitable, what sequence they should be completed in, and how improvements will support compliance and reduce bills.

“Eligibility should be linked to the property and its energy performance, rather than the personal circumstances of the current tenant,” says Propertymark. “An approach based on property need, such as targeting PRS homes with EPC ratings of D, E, F or G, would reduce barriers and help improvements remain in the housing stock for future tenants.”

Support

Propertymark has also called for the Warm Homes Fund to support independent advice services for consumers and landlords. It reckons councils could play a key role by offering one-stop-shop advice services, supported by central government, while there should also be a focus on quality control given previous problems with retrofit schemes.

Targeting lower income landlords to retrofit rental properties would be the best use of the fund, according to the Committee on Fuel Poverty, while the NRLA believes lenders should be encouraged to develop products created specifically for properties with lower EPC ratings, and says finance models are needed that combine private investment with grants and tax incentives, so landlords can access support from multiple sources.

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