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Uncertainty Over EPC Reforms Could Impact the Rental Market, Warns Property Consultancy

Property consultancy Fisher German has voiced concerns about the need for clarity regarding the new Energy Performance Certificate (EPC) regulations. The company fears that without clear direction, smaller landlords who own only a few properties might decide to sell.

Last month, Housing Secretary Michael Gove, said that landlords should be given additional time to meet the requisite EPC rating. He suggested that the current expectations might be exerting undue pressure on them.

Neil Hogbin, Partner at Fisher German’s property management division, believes that many landlords, especially those with older houses, could face hefty bills. They might need to invest thousands in their properties to align with energy efficiency goals, hence clarity regarding impending reforms is crucial.

Hogbin remarked, “Combined with the increase in energy prices because of the war in Ukraine, there is a further threat that rents will continue to rise to cover some of the costs of the EPC improvements being forced upon private landlords as they scramble to meet the new energy efficiency targets being set.”

He also emphasised the broader implications: “Decent homes in the private rented sector will no longer be affordable to many. We all want to see properties as energy efficient as possible but the sector needs certainty about how and when this will happen.”

Highlighting the gaps in policy, Hogbin noted that landlords are still waiting for financial packages to help them make the necessary upgrades in the private rental sector. He pointed out the disparity, saying, “Meanwhile, the owner-occupied housing sector has no minimum energy efficiency requirements at all.”

Hogbin further argued that numerous proposed EPC amendments might not be feasible, cost-effective, or even desired by many tenants. He believes it’s inequitable for private sector landlords to be at the forefront of achieving EPC objectives compared to other housing market sectors.

He added: “They are already taking steps to be more environmentally conscious with low-carbon heating systems and well-insulated homes where sensible and cost-effective to do so and shouldn’t need to be regulated to deliver on this.”

“Smaller landlords with just a handful of properties may sell up.”