A new survey reveals that an alarming number of landlords are not aware of the upcoming changes to Minimum Energy Efficiency Standards (MEES) for UK buy to let properties. With time running out to make green improvements to your portfolio, will you be ready?
In the not too distant future, the Government will impose new energy efficiency standards on buy to let properties. As of 2025, all properties starting new tenancies will have to reach a level C EPC (Energy Performance Certificate) rating, or be deemed unrentable. In 2028, all existing tenancies must also achieve an EPC rating of C.
These changes are important, affecting all residential landlords. The news has been out in the market for a while, yet recent data from Shawbrook Bank shows that a staggering 15% of landlords said they didn’t know that the EPC rule changes would be coming into play in the next few years. A further 25% said they had little to no awareness of the changes. That’s almost half of the 1,000 landlords surveyed with little to no awareness at all of the critical EPC changes coming in that could seriously affect their property investments a lot sooner than they realise.
The Government is enforcing these changes in response to the net-carbon zero targets that they have been set. Improving UK housing energy efficiency will help the Government achieve lower transmission levels. This comes at a time of more and more lenders offering Green Mortgages, and the market is starting to see a real shift towards more eco-friendly choices.
Why do landlords need to be aware of these changes?
Unfortunately, these changes will cost investors money; especially if landlords are unaware that they’re coming in, and don’t understand what they mean. Emma Cox, the Shawbrook Bank sales director says that “Putting off making necessary changes could leave landlords exposed to extended void periods when their property can’t be rented out while works are being completed”.
Analysis from BTL lender Habito shows that the average cost to upgrade a property from a D rating to the necessary C, is around £6,000. With 59% of homes at a D rating or below, these changes are set to impact the vast majority.
What can landlords do?
Whilst landlords face a cost in having to make these improvements, if the works aren’t completed, the property could become unrentable. The best advice we can give is to look at each of your properties and decide the best way to fund the necessary energy-efficient changes (we can help with this). It’s also crucial that landlords start to look at where they are in their current mortgage term, and when it is going to end to avoid paying further charges for ERCs if they look to remortgage. We have further details here on what the changes fully mean, and what landlords can do now in order to save money down the line.
Get in touch with us today to talk about your properties and ask any questions about the upcoming EPC changes. Call me, Charlie Potter on 01732 471648 or email me email@example.com and I can assess your portfolio to find mortgage solutions that best suit you and will help you to prepare for the energy-efficient future we’re facing.
12th January 2022