Buy-to-let landlords are paying a 12 percent premium for homes with an EPC rating of A or B compared with similar D-rated properties, according to new analysis from The Mortgage Works, adding fresh evidence that energy efficiency is starting to influence both purchase prices and rents.
The lender said C-rated properties command a smaller 3.7 percent price premium, while E-rated homes sell at a 1.7 percent discount. On the rental side, tenants are paying an average 8.1 percent premium – around £85 a month – for A or B rated homes compared with D-rated stock in England.
EPC ratings are starting to affect landlord pricing
For landlords, the figures matter because they point to a sharper divide in the buy-to-let market ahead of the proposed 2030 EPC C deadline. More efficient stock is becoming more expensive to buy, but it is also producing a clearer rental advantage.
The Mortgage Works said the strongest purchase premium for A or B rated homes was in the North of England at 19.1 percent, compared with 9.4 percent in the South and 6.9 percent in London. That suggests landlords are not seeing a uniform national market. In lower-value regions, the competition for efficient stock may be rising faster as investors weigh upgrade costs against future compliance risk.
That matters because older homes still dominate large parts of the private rented sector. Landlord Knowledge recently reported that 55 percent of homes still sit below the likely EPC C landlord target, underlining how much work many portfolios may still need.
Upgrade costs could still blunt the rental gain
The rental premium looks helpful, but it does not settle the economics for every landlord. The same analysis, based on government data and The Mortgage Works lending data, put the average cost of upgrading a pre-1919 property to EPC C at about £10,700. For homes built between 2003 and 2013 and currently rated D to G, the average cost was put at £2,500.
That gap is likely to shape decision-making across older portfolios. A landlord with a modern flat may be able to secure a higher rent with limited capital spend. A landlord with an older terraced house faces a tougher calculation, particularly if local values are modest and borrowing remains expensive.
Dan Clinton, head of buy-to-let at The Mortgage Works, said forthcoming minimum energy efficiency rules create “a strong incentive for landlords to improve their properties to EPC C so that their portfolio remains sustainable in the long term”.
He added that, given the rental premium for A to C rated homes, upgrading now “seems a logical choice” for landlords planning to stay in the market beyond 2030. Landlords can check a property’s current certificate on the official government EPC register.
This follows Landlord Knowledge’s recent coverage of green buy-to-let lending, which highlighted how lenders are trying to steer borrowing towards more efficient homes. The latest figures suggest the same shift is also becoming visible in property pricing, not just mortgage product design.
The practical warning for landlords is that the headline £85 monthly rent premium will not translate neatly into profit for every property type. In some areas, the capital needed to upgrade older stock could still outweigh the near-term gain. But for landlords buying today, efficient homes may offer a cleaner path through both tenant demand and future regulation.
What this means for landlords
- If you’re buying this year: compare the upfront premium on A to C rated homes with the likely retrofit cost of cheaper D or E rated stock.
- Watch for: whether the proposed 2030 EPC C standard keeps pushing up the value gap between compliant and non-compliant rentals.
- Bottom line: energy efficiency is becoming a pricing factor in buy-to-let, but the numbers will look very different for modern flats and older houses.
Editor’s view
Landlords have heard the case for EPC upgrades for years. What is changing now is the market signal. If efficient homes are commanding a purchase premium and a rent premium, waiting for the last minute may become the more expensive option.
Author: Editorial Team – UK landlord & buy-to-let news, policy, and finance
Published: 05 May 2026
Sources: The Mortgage Works analysis, GOV.UK EPC register
Related reading: 55% of homes still below likely EPC C landlord target
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Minimum EPC C required by 2030 – new assessment rules from late 2027
