Buy to Let

44% of privately rented homes are now energy efficient

Christina Hoghton
Written By:
Christina Hoghton

Landlords are driving the shift to sustainable housing, but they need more certainty from government around proposed EPC rules

A new report reveals that 44.5% of PRS properties are rated A-C, compared with 42.9% in the owner-occupied sector.

According to Paragon Bank, landlords have been investing in homes that benefit from increased energy efficiency ahead of proposed government legislation on minimum A-C requirements, as well as cheaper running costs typically associated with more energy efficient homes.

It’s report, Raising the standards of privately rented property, found that the number of EPC A-C rated properties in the private rented sector has risen by 165% in past decade, driven by landlords.

Government data reveals 1.925 million rental properties in England have an EPC rating of A-C, an increase of 1.2 million compared with 2011.

Tighter rules coming

Under government proposals, properties let under new tenancy agreements must be rated EPC A-C from 2025 and all tenancies from 2028. However, it is over two years since the proposals were put forward and the industry awaits an update from the newly-formed Department for Energy Security and Net Zero.

If all properties were to be upgraded by the proposed date of 1 April 2025, approximately 3,130 homes would need to be upgraded to EPC C per day, said Paragon.

Richard Rowntree, Paragon Bank managing director of mortgages, said: “The private rented sector is too often associated with poor quality housing and that is simply incorrect. Landlords have driven an improvement in standards in recent years, which is reflected in the increase in energy efficient rental property.

“However, landlords and the broader industry that serves the private rented sector now need more clarity on the government’s proposals for minimum levels of EPCs. It is over two years since the government’s consultation closed and the vacuum of information or direction since has created uncertainty and confusion.

“We believe the timescales as they are currently proposed are unworkable as the infrastructure to support the upgrading of over 2 million properties in such a short window does not exist.”