Raising EPC upgrade cost cap for landlords 'inappropriate'

Estate agents have urged the government to reduce its proposed £15,000 cost cap for landlords to make EPC upgrades to £5,000.

The 'cost cap' is the financial point at which landlords' can claim a 'high cost' exemption from the regulations, which currently standS at £3,500.

The Department for Energy Security and Net Zero is consulting on plans to introduce higher Minimum Energy Efficiency Standards (MEES) for the PRS, including the cost cap.

However, a Propertymark survey of 350 members reveals widespread concern that the higher cap will price landlords out of the market or lead to rent hikes that harm tenants. It believes a lower cap would allow landlords to make more incremental adaptations which fit within their budget.

“Tenants are likely going to have to temporarily move out of the property

In its response to the consultation, it adds: “Tenants are likely going to have to temporarily move out of the property; it is not yet clear if the cost of temporary accommodation could be included in the cost cap, and if the property is void it would be an additional loss of income on the landlord to make improvements before the property is liveable again.”

'Inappropriate'

Propertymark says the proposed level of £15,000 per property is inappropriate and will disproportionately impact smaller landlords along with those living in areas of the country with lower property values. “We call for more accessible, well-publicised, and appropriately tailored funding options.”

The consultation proposes a shift to a new EPC metric following EPC reform, a phased timeline requiring new tenancies to comply by 2028, and all tenancies by 2030 and obligations for landlords to commission new EPCs before and after works.

Propertymark argues that the proposed ‘fabric-first’ approach disadvantages older, rural, and heritage properties unfairly. It also recommends a single compliance date of 2030 for all tenancies - new and existing – to avoid confusion and give landlords sufficient time to plan and upgrade properties.

It adds: “We support an extended 10-year exemption period and recommend further exemptions for listed buildings, properties with recent EPC improvements, and cases where proposed upgrades increase energy costs. We also propose exemptions where tenants do not consent to disruptive works.”