solar panels landlords energy efficient

Energy efficient rental homes: new update due for 2025

Labour has pledged to relaunch the previous government’s plans to make rental homes more energy efficient, and a new consultation could get the ball rolling.

By now, the vast majority of existing landlords as well as many prospective ones will be aware of upcoming potential changes to energy efficiency standards in the private rented sector. The much-debated topic was under the spotlight during the Tory leadership, and remains so since Labour came into power last summer.

Before the targets were scrapped by then-Prime Minister Rishi Sunak back in 2023, there had been a proposal for all rental homes to become more energy efficient (achieving a minimum energy performance certificate, or EPC, rating of C) by 2025 for new tenancies, and by 2028 for existing ones.

While this proposed legislation never made it through Parliament, it had already created some uncertainty in the buy-to-let sector, with reports of some landlords selling their older, less energy efficient properties, while others invested in upgrades in order to gain a higher EPC rating.

Arguably, any moves to improve the energy efficiency of the sector could help to boost the quality of properties on offer, while also having the potential to improve the longevity of an investment in an energy efficient home. This has led to a rise in interest in new-build properties for investment, as they are seen as a more future-proof option.

What’s the latest?

Last week, when asked about the Department for Energy Security and Net Zero’s plans on reinstating the Conservatives’ scrapped plans to improve how energy efficient privately rented homes must be in the UK, energy minister Miatta Fahnbulleh confirmed that the party would be consulting “shortly” on this topic.

She said: “The consultation will include proposals for rented homes to achieve Energy Performance Certificate C or equivalent by 2030.

“In this consultation, we will set out proposals on the exemptions regime for properties that cannot meet the proposed increased standard. We encourage landlords and other key stakeholders to feed into this consultation when it is published.”

Other potential changes on the cards include reducing how long EPCs are valid for, changing how they are calculated, and expanding existing laws to include houses in multiple occupation (HMO) under the same rules.

Energy efficient homes on the way

The Labour party, according to energy secretary Ed Miliband, is offering the UK “the most ambitious climate and energy plan in British history,” and it seems that 2030 is set to be a key year for the country in its progress towards this.

A huge number of changes across many industries are up for review to achieve net-zero, including creating a zero carbon electricity system, and banning the sale of new internal combustion vehicles. Central to its policy is also its Warm Homes plan, involving boosting the energy efficiency of millions of homes across the country.

In the private rented sector, the plan remains very similar as it was under the Conservative government: to ensure all privately rented properties can demonstrate how energy efficient they are by achieving a rating of C or higher on their EPCs.

Current regulations in the UK mean it’s a legal requirement for landlords to obtain an EPC before renting out a property. An EPC is valid for 10 years, and must be provided free of charge to prospective tenants. Failure to comply with this requirement can result in financial penalties and legal consequences, so it’s crucial to ensure that your property has a valid EPC before advertising it for rent.

If new legislation comes into play, this means landlords would need to prove their home’s EPC is rated at C or higher, or they may need to be able to show that they have spent a minimum required amount on improvements and secured an exemption certificate.

 

Self-certified Sophisticated Investor

Please read

I declare that I am a self-certified sophisticated investor for the purposes of the restriction on promotion of non-mainstream pooled investments. I understand that this means:

I am a self-certified sophisticated investor because at least one of the following applies:

I accept that the investments to which the promotions will relate may expose me to a significant risk of losing all of the money or other property invested. I am aware that it is open to me seek advice from someone who specialises in advising on non-mainstream pooled investments.

High Net Worth Investor

Please read

I make this statement so that I can receive promotional communications which are exempt from the restriction on promotion of non-mainstream pooled investments. The exemption relates to certified high net worth investors and I declare that I qualify as such because at least one of the following applies to me:

aerial-view-uk-houses

STAY AHEAD OF THE MARKET

Sign-up for first access to new developments and exclusive property investment opportunities.

We send limited and targeted emails on new launches and exclusive deals which best fit your areas. We are trusted by over 30,000 active buyers as their source for new stock.

  • New property developments
  • Professional market reports
  • Property deal alerts
  • Development updates
UK holiday let

FIRST FOR NEWS AND KNOWLEDGE.

Receive trending news straight to your inbox and stay up to date on all of the property market trends and advice.

Established since 2005 we are a leading voice of authority and commentary on the UK property market. Our news is trusted by Apple News & Google News.

  • UK housing market
  • Mortgage & money
  • Buy-to-let landlords
  • Guides & advice

Talk to us

Speak to our UK property experts today:

 

+44 (0) 333 123 0320

Open from 9am-6pm GMT

 

+852 6699 9008

Open from 9am-6pm HKT