According to Paragon Bank, 37% will make improvements to their rental properties, while an additional 32% of portfolio landlords said that they already only hold properties rated EPC C or above.
Green home upgrades on hold
However, some landlords are more reluctant to upgrade their properties without clear direction from the Government – 16% have postponed undertaking any improvement works until legislation mandating EPC C or above is introduced.
Prime Minister Rishi Sunak announced that proposed changes to the current Minimum Energy Efficiency Standard (MEES) would be scrapped. The proposed regulations would have required all properties let for new tenancies to have a minimum EPC rating of C by April 2025, extending that to all tenancies by 2028.
Timescales for improvements
Paragon’s research showed that 28% of landlords undertaking improvement works anticipate reaching EPC C ratings across their portfolio within 1-2 years and 22% in 3-4 years.
Nearly one in five (18%) expect to finish green upgrades in the next 12 months, while 17% said it will take them five years or more.
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The English Housing Survey shows that 44.9% of private rented sector (PRS) properties have an EPC rating of A-C, compared to 43.3% in owner-occupation.
Richard Rowntree, managing director of mortgages at Paragon Bank, said: “It’s encouraging to see portfolio landlords continuing to enhance their properties so they meet EPC C or higher, despite the proposed regulations being shelved.
“These landlords will join almost a third more who have carried out sustainability-focused upgrades or purchased property already benefitting from energy-saving technology, highlighting the commitment amongst portfolio landlords to improve the standard of privately rented homes for tenants.”
Louisa Sedgwick, Paragon Bank commercial director of mortgages, added: “We often see landlords release capital from existing properties in their portfolio to fund expansion or property upgrades.
“With mortgage rates lower than last year, we are seeing increased interest in remortgaging across the market to support landlord growth ambitions.”
Related: Government allocates funding for green home improvement projects
