It’s Time to Future Proof Your Rental
Do you know the EPC rating of your rental property? Do you know what changes you would need to make to improve it? Do you know about the changes to rental laws in regard to EPC ratings that are arriving in 2025?
If you don’t, you are not alone. While 25 per cent of landlords are unaware of their EPC rating, a fifth of landlords said they didn’t know how much it would cost to improve it and 15 per cent said they were not aware of the upcoming changes.
So, are you EPC ready?
What changes are coming?
As part of the UK Government’s pledge to take action against climate change, the recent bill works as part of the commitment to improve the energy efficiency of properties in England and Wales. The guidelines stipulate that by the year 2025, any rental property let to new tenants must have an EPC rating of C or above. For many landlords, this is going to take a lot of work. A lot of properties on the rental market in the UK date from before the war and these are more likely to have a poor EPC rating making them unsuitable for tenants. The estimated costs involved in making the necessary changes amount to almost £10,000 per property and the deadline is fast approaching. With the way that the construction industry is at the moment, with labour shortages and long waiting lists, you need to start looking into making changes now in order to meet the deadline and be able to budget in the expense.
Propp is just one property finance comparison site, and the managing director advises that landlords need to factor in an additional 10 per cent cost on top of the original purchase in order to improve the EPC of their property. Energy efficiency makes a property a lot more attractive when it comes to selling it on. If you ignore the issue you’re going to find yourself left with a property that’s not only unrentable but unsellable too.
What impact is going to have?
You may find that you will need to put up the price of your rental which is going to make your property less attractive to potential renters who are struggling to cover the costs of living anyway. If you own an older home, you’re going to struggle to sell the property on without making some changes. People aren’t going to want to invest in a property that’s going to cost them more money in improving the EPC rating. Understandably, there’s going to be a lot of time, money and effort that will need to go into these improvements. Even if you don’t want to sell the property, you may need to offer alternative accommodation for your tenants while improvements are made while also dealing with the loss of rental income during that time.
What can you do?
As has previously highlighted, a big issue is the lack of understanding and awareness of the situation. Therefore, educate yourself. Start by finding out the EPC rating of your building and how to improve it. Research the costs involved in certain home improvements and find an option that will save you the most money in the long run. Learn more about the guidelines coming into place but also the funding options available that will help you financially to make these necessary changes. Use a finance comparison site to find the best financial solution, whether that be a refurbishment bridge or second charge bridging loan.
You’re not in this on your own!
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