Only new-builds could reach the top energy efficiency rating in 2050.
New-builds will be at the peak of energy efficiency, according to the net-zero 2050 plan.
According to a commentary from David Smith, real estate partner at JMW Solicitors, only new-builds or heavily upgraded properties are likely to reach band C by the 2025 target date.
“This will be a big change,” he says. “Moving to band E only affected around 200,000 of the least efficient properties based on government figures. Moving to a band C will affect well over two million properties, approaching half the buy-to-let sector depending on whose figures you prefer.
“The approach taken by the Department for Business, Energy & Industrial Strategy in their proposal is difficult to understand as it fails to take into consideration the reality of properties in the UK.”
Landlords and property investors most able to keep up with the new requirements are likely to be those who invest in cities and towns, in either newly built or newly refurbished properties. This is because there is a greater concentration of older properties in more rural areas, whereas urban areas are constantly benefiting from new, modern homes being built.
While newer properties generally come at higher price points compared to older ones, there is normally more value to be had. With the EPC upgrade in mind, investing in a home that already meets the future minimum requirements means a lot less hassle down the line in making upgrades and improvements.
From a tenant’s perspective, a more energy-efficient home means savings as well as environmental benefits. Lower energy bills and a less draughty, warmer home are attractive qualities for renters, even if the rent is slightly higher than in an older property.
For landlords who already own properties with low energy efficiency, there may be big costs ahead. A survey earlier this year by The Mortgage Works found that 35% of 750 landlords were “not confident” they could reach an EPC rating of C in their properties.
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