A mortgage lender’s survey reveals that over two-thirds of private landlords currently own at least one property that does not meet the new EPC ‘C’ target.
Foundation Home Loans’ research found that awareness of these EPC standards is high, with 92% of landlords having at least some awareness of the requirements but only 67% reporting a thorough understanding.
Portfolio landlords with four or more buy to let mortgages demonstrate slightly lower knowledge, with 62% stating they fully understand the requirements compared to 69% of unencumbered and consumer borrowers.
Some 42% of landlords intend to make the necessary improvements to bring their impacted properties up to standard.
Meanwhile, 24% plan to carry out works at the minimum cost required to comply, and continue to let the property out, and another 14% aim to carry out the works that maximise the long-term value of the property and continue to let it out.
Some 3% will carry out works to bring their property up to standard then sell it.
However, 34% plan to sell without undertaking any work or not re-let the property, 17% responded ‘other’ and 3% don’t plan to carry out any works but continue letting the property out.
For those who plan to carry out the necessary work, 17% expect to use their savings, 41% via rent increases and 28% through grants. A further 12% saying they would release equity from their portfolio and 5% seeking a further advance from a mortgage lender or 5% from a loan.
The lender undertook 720 online interviews in September and October and a spokesperson says: “With potential new legislation aiming to raise energy efficiency standards and tackle fuel poverty for millions, landlords face important decisions around future-proofing their investments from an EPC perspective.
“Thankfully, this research helps demonstrate growing awareness among landlords around this topic and highlights both the financial and planning considerations involved in meeting these requirements.
“It also underlines the tremendous potential for lenders and intermediaries to support sustainable practices in the buy-to-let sector, particularly through tailored green mortgage products that align with both regulatory demands and landlords’ unique needs.”
