Private rental properties are caught in an unusual government policy no-man’s land currently if they want to replace a property’s boiler but need grant support to pay for it.
Because while the government’s successful Affordable Warmth scheme will pay for a PRS property to be upgraded with cavity and loft insulation this doesn’t cover a new boiler.
But on the other hand, the government’s Green Homes Grant which was intended to fill this gap has now ended, leaving tenants and landlords in limbo.
The Green Homes Grant came to an end in March 2021 after only 22,165 grants worth £94.1 million were issued. The initial target was to secure grants for 600,000 homes both inside and outside the PRS.
The Affordable Warmth scheme is a consequence of the government’s Energy Company Obligation, which requires larger energy suppliers to deliver efficiency measures to fuel-poor households in the UK.
But since the latest version of the scheme, which was introduced 18 months ago, this has excluded replacing boilers in privately-rented properties.
This is not a funding thing – the government plans to increase annual spending on the ECO scheme to £1 billion until 2026 to increase energy efficiency for low income and vulnerable households.
What can landlords do?
Having accepted the ambiguity of government plans to help landlords or tenants pay for new boilers, so boiler finance plans have become more popular with PRS property owners who can’t stump up for a new boiler in cash.
According to Heatable.co.uk, a digital boiler installation platform operating UK wide – there has been a steep rise in the popularity of boiler finance options among landlords including 0% interest plans over a two-year period the preferred package.
The average cost of a boiler is over £2,000 so being able to spread payments is the main win, but there’s protection too including from the stress of a boiler breaking down, something many newer landlords struggle to deal with.
Much like when using a credit card, the lender or bank facilitating the boiler finance loan provides an additional layer of consumer security and a peace of mind you’ll likely not find through traditional heating companies.
Sam Rigby, CSO at Heatable says:
“The post Covid climate has left homeowners and landlords alike with financial hardships they could have never accounted for. Moreover, the number of unfortunate Brits now short of, or entirely out of work at present that are currently accommodated in private rentals is of course having a knock-on effect to landlords.
A Government U-turn that would see private tenants qualify again for entire boiler grants or contributary funding seems less likely than a smooth Brexit transition right now, but never say never.
It means that finance plans for new boiler installations, particularly interest free agreements are of huge benefit, if not imperative to many homeowners and landlords at present. At Heatable, we’ve worked well with lenders to offer an incredibly easy Point of Sale route to finance through our digital platform, in addition to the ease of which we’ve allowed and helped landlords to purchase and arrange new boiler installations.“
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