The rental property sector is grappling with a monumental task as it races to meet government-mandated energy efficiency standards. A recent analysis by Hamptons suggests it could take nearly two decades for all rental properties in the UK to achieve the proposed energy performance requirements.
Aneisha Beveridge, Head of Research at Hamptons, highlighted the scale of the challenge: “To meet the government’s 2030 target, the same number of homes will need to see energy upgrades over the next five years as we’ve seen make improvements in the last 30 years.”
A generational shift in property energy efficiency
The current trajectory indicates that it will be 2042 before all rental properties reach at least an Energy Performance Certificate (EPC) rating of C. This timeline starkly contrasts with the government’s ambitious 2030 target, underscoring the significant gap between policy aspirations and the current rate of progress.
Miatta Fahnbulleh, Minister for Energy Security and Net Zero, recently reaffirmed the government’s commitment to this goal, stating that rental properties must achieve a minimum EPC rating of C by 2030. This mandate comes after the previous Conservative government had shelved the requirement due to concerns over costs for landlords, particularly those with older properties.
The mammoth task ahead for property investors
To meet the 2030 deadline, approximately 340,000 rental homes must be upgraded annually to achieve at least a C rating. In 2024, projections suggest that around 115,000 homes will undergo sufficient improvements to meet this standard.
Despite the daunting nature of the task, Beveridge noted some positive trends: “Despite the challenges, many investors have continued to improve the energy efficiency of their rental homes and we’re currently on track to see 100% of rental homes where an EPC A-C is viable, reach that rating within a generation.”
Racing against time: Can landlords meet the 2030 target?
As the clock ticks towards 2030, the property sector faces mounting pressure to accelerate its compliance efforts. The ongoing improvements reflect a significant commitment from property investors, who are gradually enhancing the energy efficiency of their portfolios.
However, the gap between the current pace of upgrades and the government’s expectations remains substantial. As landlords navigate this shifting regulatory landscape, the coming years will be crucial in determining whether the sector can rise to the challenge and meet the government’s environmental and energy efficiency goals.
