A leading bank in the UK has reviewed the impact of Energy Performance Certificate (EPC) regulation changes, and they believe some landlords will lose up to £9,500 a year.
Most landlords cannot sustain lengthy void periods
This is the estimated sum that some landlords will miss out on with respect to annual rental income. If a landlord is unable to let their property because it no longer complies with EPC regulations
Some key findings from the bank’s research work includes:
- 30% of landlords are yet to make any energy efficiency upgrades to their rental property, although many claim they will start in the next 14 months
- 10% of landlords say they won’t start work for another three to four years, which means the 2025 deadline for EPC changes is looming large for many rental market professionals
- 42% of landlords said their tenants would have to leave the rental property while home improvement work was carried out
- 38% of landlords said they expect their rental property to lie vacant for a minimum of four weeks, which will likely cost them £5,000 in rental income
With nearly a quarter of landlords saying their rental property holds a D or poorer rating, a significant number of rental properties will not be suitable for rental purposes.
Landlords need to find money to pay for the cost of improving their rental accommodation
27% of landlords said they didn’t know what the energy efficiency rating of their rental property was. While studies suggest landlords believe the cost of home improvements to get their rental property up to standard will be £5,9000; 69% of landlords don’t have the necessary funds to pay for these changes.
Emma Cox, real estate managing director at Shawbrook Bank, said; “We welcome the proposed legislative changes and the opportunity this will provide landlords and members of the private rented sector to be at the forefront of the UK’s green revolution. However, there are many unanswered questions about the deadline and possible incentives to enable improvements to be made, so further clarity and education is needed to support landlords through the changes.”
Emma concluded by saying; “For landlords that don’t have access to the necessary funds to make improvements, brokers can play a key role in supporting them. There are cost effective funding options available, such as bridging finance, and brokers are well placed to help make landlords aware of these solutions.”
Contact Holmes Estates for all your South West London housing needs in 2022
We have considerable experience and expertise in the South West of London. We are ideally placed to help vendors, tenants and landlords during this challenging time. If you have any questions regarding the South West London property market, please get in touch with Holmes Estates today.