Yes, we've covered the upcoming legislation on minimum energy standards before, but as landlords start to address the issue, the cost to each individual is becoming clearer.
Back in 2015, new regulations were introduced which required new tenancies for private rented properties to have an Energy Performance Certificate of E or above. This was implemented in 2018 and extended to cover existing tenancies in 2020.
Legislation currently in the parliamentary process will increase the threshold to EPC level C. The start date for new tenancies is 2025 and for existing tenancies 2028.
The UK's housing stock is amongst Europe's oldest. It is estimated that 60% of homes would fail the new standard. The most affected are pre WW2 properties, which have long been the backbone of many buy to let portfolios.
The Department for Levelling Up, Housing and Communities (DLUHC) estimates the cost of upgrade from D to C at an average of £6,400. Retrofits of E rated properties will cost more. One landlord trade association has quoted a figure of £16,000.
New research from BDRC and Aldemore Bank has now quoted an average cost of £10,400. Landlords owning affected properties will have little choice but to pay for the upgrades or sell. BDRC's survey indicates that 15% of affected landlords will sell.
Figures issued by the DLUHC covering Q4 2021 show that 84% of newly built properties in England achieved a rating of A or B, with a further 12% achieving level C.