The Prime Minister’s speech scrapping proposed energy efficiency targets for households, including rental properties, has received a mixed response from the sector.
National Residential Landlords Association (NRLA) chief executive Ben Beadle explains that the NRLA wants to see all properties as energy efficient as possible. However, the uncertainty surrounding energy efficiency policy has been hugely damaging to the supply of rented properties.
“Landlords are struggling to make investment decisions without a clear idea of the government’s direction of travel.
“It is welcome that landlords will not be required to invest substantial sums of money during a cost-of-living crisis when many are themselves struggling financially. However, ministers need to use the space they are creating to develop a full plan that supports the rental market to make the energy efficiency improvements we all want to see.
Beadle insists this must include appropriate financial support and reform of the tax system which currently fails to support investment in energy efficiency measures.
Market Financial Solutions CEO Paresh Raja believes the U-turn on green pledges feels significant for Rishi Sunak and his party and it will create a furore that will last for some time.
“Looking specifically to the scrapping of the impending EPC regulations, we have to acknowledge what a complex issue this is. Many landlords will breathe a sigh of relief that there is no hard deadline for them to upgrade D-or-below related properties. Tenants may also benefit – rental prices might have risen in order to cover the costs of landlords upgrading their properties.
However, he says many landlords will have already improved the energy efficiency of their properties at great expense, so the announcement may trigger some frustration.
“Moreover, the next general election could result in the winning party reintroducing new EPC rules anyway, so the decision brings further uncertainty into a property market that would benefit from greater stability. Meanwhile, there are some renters who will worry about living in properties with poor energy efficiency – their bills this winter will reflect that”.
Raja believes the announcement will offer some relief to landlords in the short-term, but the long-term goal – as in every industry – must be to work together towards a more sustainable future.
Mortgage Advice Bureau deputy CEO Ben Thompson says the reality is that the UK will still need to upgrade its leaky housing stock.
“With energy bills in the spotlight, EPC ratings are climbing up prospective buyers’ wish lists, and if the housing market is to meet net zero targets, properties need to be retrofitted”.
The UK has some of the oldest and least efficient homes in Europe, and backtracking won’t help solve the overall problem – it simply serves as kicking the can down the road.”
