Third of landlords to miss energy deadline

Money worries and dated properties have meant more than a third of landlords expect to miss the deadline to raise energy performance certificate ratings for rental homes.

Professional landlords were more likely to fall short on the climate change targets, according to research by lender The Mortgage Works, because of struggles in accessing properties already occupied by tenants and the disruption caused by works.

The minimum energy rating for rental properties will increase to Band C from Band E from 2025 for new tenancies and 2028 for existing tenancies, in a bid to cut carbon emissions.

However, a survey of 750 landlords found 35pc were not confident their properties would meet the required energy standards in time. Of these, 27pc said a lack of funds hampered any improvements.

The cost of converting properties to meet the new rules can be significant. More than one in 10 landlords expected to spend all of their annual rental income, or more, on green improvements. However, almost a third did not envisage spending more than 30pc of their annual income, and one in five expected to spend nothing at all.

The £ 2bn Green Homes Grant scheme, which launched in September 2020 and for which applications closed earlier this year, to help homeowners upgrade their homes has been plagued by delays and a shortage of installers.

The plan was supposed to provide grants of up to £5,000 to cover the cost of energy efficiency upgrades. However, the Country Land and Business Association, a trade body, has warned that rural landlords in particular had been unable to access the funds.

Concerns have been raised over many accredited engineers refusing to travel to remote locations due to the huge demand for work in their local areas.

The issue is expected to compound an exodus of 50,000 rural landlords triggered by the climate change policies, the equivalent to one in eight rental properties in the countryside.

Landlords are currently allowed to let homes with a lower rating than Band E if they spend £3,500 every five years to improve energy efficiency. However, this minimum spend will increase to £10,000 when the new rules are implemented.