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Upcoming EPC legislation changes: what landlords need to know

Energy Performance Certificate (EPC) requirements for letting out properties are projected to change as early as 2025. Currently, the law requires EPC ratings for rented properties to be at an E. This is projected to change over the next couple of years to be at a C. As a landlord, how and why should you prepare for upcoming changes?

good epc rating on a boiler fitted to a wall


There are 30 million homes in the UK which account for about a quarter of all emissions. We need to improve domestic properties to make the UK more energy efficient to reach the government’s target of net zero by 2050. In 2022, almost half of all EPCs had a rating of D or below. D is the average rating across the UK. Private rented properties are the least efficient on the market.

If you don’t know what an EPC rating is already, it is important to understand more in order to improve them.

What is an EPC rating?

An EPC rating is a measure of the energy efficiency of a building or domestic home in the United Kingdom. The rating is based on the energy use and carbon emission levels of a given property, and ranges from A (very efficient) to G (inefficient).

EPC ratings are calculated by energy assessors who check many areas of the property such as insulation, heating, lighting, and any additional aspects of a building that might affect energy consumption. These certificates are required for renting or selling a property and they are valid for ten years, but should be updated whenever a home upgrade which will alter energy efficiency is installed.

The purpose of these certificates is to provide buyers, renters, and occupants with information about the energy efficiency of a property, which can help them to make more informed decisions about the property’s environmental impact, running costs, and how to improve them.

To learn more about EPC ratings, read our blog post here.

Reasons to improve your EPC rating

There are lots of reasons to increase the EPC ratings of your properties. Landlords should look to get ahead of the game for these reasons:

The energy and cost of living crises 

Last October, 4.5 million households were in fuel poverty. This is, essentially, when people have to choose between heating and eating. This figure is suspected to double this April. Improving the energy efficiency of a property results in lower energy bills. The better insulated a home is, the less likely the occupants are to turn the heating on. The more efficient a heating source is, the less hard it has to work to heat a home. If you use solar panels, you will often be making a small profit off the generated power. Cheaper energy bills are guaranteed to make your properties more attractive to prospective tenants. Under various government funding schemes, the most vulnerable in our society can have home upgrades funded or subsidised. Your current tenants could qualify for a variety of schemes such as ECO4, ECO Flex, or HUG.

Comfort


Green mortgages

According to MoneySavingExpert, five years ago “you’d have been hard-pressed … to find a single mainstream lender willing to give you preferential treatment on the basis of an energy performance certificate … there’s now a handful of high-street banks that claim to do just that via their own versions of a green mortgage.”

Portrait of male landlord standing in a property



On Barclays website they write that buying an energy efficient home can get you a better mortgage rate. For a green mortgage you will need an A or B EPC rating.

Reduce your carbon footprint and increase property value

In today’s environmentally conscious society, many tenants and buyers are looking for properties that are energy efficient and have a low environmental impact. A poor EPC rating can make a property less attractive to potential tenants or buyers, reducing the demand for the property and potentially lowering its value. Improving the EPC rating of any property reduces its emissions of greenhouse gases.

This will eventually be the law

The UK government has set ambitious targets for reducing carbon emissions and increasing the energy efficiency of buildings, and legislation related to EPC ratings is likely to be a key part of this effort. Landlords who are not prepared for these changes may find themselves in violation of the law, facing fines or other penalties. At the very least, it is worth getting ahead of the game now. Contact us today on 0800 024 8505 and we can assist you every step of the way!

couple in front of their new home


More useful sources for landlords: 

Homebuilding – Future Homes Standard: The Complete Guide to The New Targets

Mortgages for Business – Not Going Away: Buy to Let EPC Regulation Changes – (very helpful article which inspired this one)

OSB Group – LANDLORD LEADERS. A new environment for the Private Rented Sector

Check If You Qualify!

Regardless of whether you’re a homeowner or private renting, you could end up receiving free home improvements courtesy of the ECO scheme, it takes less than 30 seconds to check!

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