Landlords have been left with a ‘green gap’ of finding up to £10,000 per property to meet new energy performance targets after the government scrapped its Green Homes Grant scheme.

Online mortgage broker Property Master acknowledges that the troubled scheme was difficult to access, made it hard to find the correctly registered tradespeople and suffered from a cumbersome process to redeem vouchers, however, it says landlords deserve a replacement. 

Chief executive Angus Stewart (pictured) adds: “Landlords could be forgiven for thinking the new energy regulations in the absence of government support is just an extra backdoor tax on the private rented sector.

“For many this will be a squeeze too far on their finances and they may well choose this moment to exit the market which will reduce the number of homes for rent.”

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The government has set an ambitious target as part of its Net Zero greenhouse gases by 2050 programme of raising the energy performance certificate for all new tenancies in the private rented sector to a C or above by 2025. By 2028, this requirement will extend to all private rented sector properties. 

About 67% of private rented properties in England and Wales – 3.2 million in total – are currently a band D or below.

The £2 billion Green Homes Grant scheme was only launched in September 2020 but will close on Wednesday. Up to £5,000 per property was available, no more than two thirds of the cost of the work done. 

To date, only about 60,0000 of the 600,000 available vouchers have been taken up to fund improvements such as cavity wall insulation and draught proofing. 

13 COMMENTS

  1. “For many this will be a squeeze too far on their finances and they may well choose this moment to exit the market which will reduce the number of homes for rent.”

    That’ll be me exiting the market.

    “The government has set an ambitious target as part of its Net Zero greenhouse gases by 2050 programme of raising the energy performance certificate for all new tenancies in the private rented sector to a C or above by 2025. By 2028, this requirement will extend to all private rented sector properties. ”

    The cost of raising a property from a D to a C isn’t worth it. I’ll be selling up as properties become empty.

    “About 67% of private rented properties in England and Wales – 3.2 million in total – are currently a band D or below.”

    That’s 2,144,000 properties. A lot of properties. I know several landlords who will be selling up as a direct consequence of having to spend, possibly thousands of pounds upgrading to a D. I’m one of them. It’s the final nail in the coffin for them. There are other ventures to invest in. I don’t know how many of these, over two million properties will be sold, and I’ve even less idea of where all these tenants are going to go. I only hope the government can provide housing for those unfortunate tenants who have to suffer the consequences of government ideas.

    The government must really hate private renters.

  2. And when a D or worse property is sold rather than upgraded – who will buy it ? Yup, an owner occupier who also (probably) won’t have the cash to upgrade it either. So the net effect will be … nothing at all in terms of energy efficiency !

  3. Over the last 4 years or so I sold anything that was E and have done quite a bit to move D rated up to C yet I find that even modern properties built in the 1990’s with a new boiler still don’t make C.

    I’m currently selling a property built in the ’90’s that is a couple of points off C yet I’ve literary done everything including new boiler two years ago, increased loft insulation and LED lighting throughout. I even put an additional cylinder jacket on the pre-lagged tank. Perhaps I should have converted to combi?
    The only other avenues open to me to reach C would be floor insulation throughout, a very costly and disruptive thing to do.

    That was a great modern property that is no longer available for rent and the fact that I got an offer within 6 weeks shows there is nothing wrong with the place.

    I have decided just to cash in and buy myself a nicer house with the money because currently until the Eviction bad etc is lifted I’m not taking the chance to re-invest in the PRS.

    However, I suspect landlords are actually in a sweet spot at the moment because for govt to reach their targets I’m convinced ALL property owners will eventually be compelled to raise the energy efficiency of their homes so I’d say sell now whilst you can because there will come a time when private buyers start to seriously consider the EPC when buying for themselves and at that point anyone with an E and possibly even a D rated property will struggle to sell at all.

    I can see the govt in a few years time saying “With very little cost or disruption the nations landlords have achieved our goal of raising standards therefore that model will now apply to all properties.

    • I doubt any government would have the courage to force homeowners to upgrade in the same way they have with landlords. Instead they will do it via the back-door, as they are already doing; Mortgage companies have been told they need to prepare for their lending portfolios to contain a minimum number of homes with EPC ratings of C or above. Already some mortgage companies have responded by offering lower rates for energy efficient homes.

  4. And I suppose I will have to contribute to having the royal palaces and No 10 &11 up graded.
    Will the government up grade all military barracks and housing by 2025.

  5. The UK produces less than 1% of global emissions. With a zero emission target of 2050 it’s not going to make much difference one way of the other if rental properties are C in 5 years’ time or 30. Improving energy performance in such a tight timeframe has nothing to do with saving the planet it’s all about politics; the Government trying to virtue signal, demonstrate their green credentials and make a play for the renters’ vote – all at expense of landlords.

    Rather than create a sustainable industry to upgrade stock over the next 30 + years, there will be a big rush of pop-up businesses and profiteering cowboys with no commitment to long-term investment. But also, there are many nascent lower-cost solutions that could be taken advantage of (e.g. hydrogen gas boilers), but we need to be considered and avoid a politically motivated knee-jerk reaction.

  6. Seems crazy that only rented houses are being targeted. Most properties are owner occupied & so surely it is those that should be targeted to get high grade epcs. I’m in the process of selling half of my properties due to the vast costs involved to get such a hogh epc rating.

    • Of course you are right its all about votes… That’s why the eviction ban has been extended till end of may (After the elections) nothing to do with Landlord & Tenant.

  7. If somebody is not white, female, homosexual or disabled and they are victimised, they are protected by the law. Unfortunately it’s not illegal to victimise landlords. If it’s acceptable for home owners to not have to waste their money on illogical government initiatives, how can it conceivably be fair to force landlords to do so? Landlords are clearly being unfairly targeted. This government is supposed to favour free markets and freedom of choice, but its policies are becoming more and more interventionist and socialist, and these are the best option, the others being even more extreme.

  8. Agree with all of the above! Why aren’t Council and Housing Associations houses being treated in the same way? No EPC required nor EICR’s. Don’t the subsidised Council & Housing Association tenants matter?
    It is purely a vote catching piece of legislation that lacks any consistency with the need to reduce global warming. Ignoring these and owner occupiers reduces the potential gain to about 30% of all UK housing.

  9. There is no need to reduce global warming.

    Man cannot affect the climate.

    Millions of years ago the climate was hot and sweaty with jungle everywhere.

    However having energy efficient properties is wise to save energy costs.

    But to expect millions of rental properties to be retrofitted to achieve EPC C status is for the birds.

    Few LL will bother.
    The payback time would be decades.

    No wonder then that in many of the comments LL agree that this wilm be the case so they are selling off these dud properties to mug OO.

    The EPC requirements will cause a massive shortfall in rental properties.

    EPC C status will be far more effective than S24 in forcing LL to sell up.

    LL need to start selling now as there will be a flood of these dud properties coming on the market in 2025 onwards.

    Get rid of them before buyers wise up to EPC C status requirements.

    LL should sell off and either retire early or rejig their portfolios to reduce numbers and leverage.

    Maybe consider two really good properties to C status but only if holding for 15 years.
    If not just sell.

    With the abolishing of the AST and S21 the EPC C status situation just piles on the agony.

    It just isn’t worth being a leveraged LL anymore.

    Govt should accept that the UK housing stock cannot easily achieve C status.

    For a start no IWI or EWI should be required.
    If a property has had the usual stuff then that is all that should be required.

    Most properties are solid walled.
    It is not appropriate to require them to have this wall insulation to achieve C status.
    It is simply too expensive as retrofit.

    I find putting on a jumper makes things comfortable.
    Cheap and saves thousands on stupid wall insulation.

    The maximum any rental property should have is

    LED bulbs
    DG
    CH or other heating devices
    Loft insulation

    Whatever EPC is achieved for that rental property should be it.

  10. Some of us cannot actually exit the market – we are in negative equity due to 2008. Until or unless an area rises in value – and not all do! – or one can find sufficient cash to pay off a bit of mortgage, one is bally well stuck with it and cannot even remortgage to a better rate due to insufficient LTV. This phenomenon is known as mortgage prison. Our flats have better living standards than our own house does, as we have an obligation to provide decent accommodation (pay attention all you ‘Trotsky’ types out there – if you buy your own house, you have to pay and pay and pay. You pay for heating to be installed, as well as to run it. You have to pay to have your own roofs mended. And so on. Don’t just think you’re getting a free house! That is basically why you are much better off renting!) that doesn’t leak, and is warm and comfortable. None of which occurs in our own house, because all the funds go into the flats. And we are stuck with them, unless we want to give in and have a huge debt to the mortgage lenders. Gosh, Britain really sucks. Shite weather, too!

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