Just over half – 52% – of property owners who need investments to align their energy efficiency ratings with current regulations have considered selling, according to a The Mortgage Works (TMW) report form.
The government has decreed that all rentals will have an Energy Performance Certificate (EPC) of at least “C” by the end of 2028.
Of the 621 homeowners surveyed by Nationwide’s Buy-to-Lease (BTL) arm, nearly two-thirds have properties that will need improvement.
The more properties an owner has, the more likely they are to consider selling. TMW found that 63% of those surveyed with 20 or more properties had considered it, 58% of those with six to 10 properties and 35% of individual owners.
And a significant number of owners, 33%, don’t know what improvements they need to make to comply with the new regulations.
Of those in the know, 37% said they needed to install traditional insulation and 25% cited boiler upgrades.
These numbers, according to TMW, naturally increase with the number of properties an owner has: “About 59% of people with 20 or more properties say they will need to install traditional insulation, while more than a third (37%) will need a boiler. upgrade, ”the report says.
TMW has also found that homeowners, on average, don’t have a significant amount of money for unforeseen costs.
The average amount an individual owner has saved is £ 6,599, while those who own four to five properties have, on average, just under £ 15,000.
Owners of 20 or more properties have an emergency fund of £ 35,202.
Earlier last month, Habito determined that the cost of upgrading a property from an energy performance certificate from D to C can be up to £ 6,155.
Daniel Clinton, TMW Loan Manager, said: “With currently less than four years before all new rentals must be in properties rated EPC C or higher, there are still some homeowners who need to undertake repair work on the property. at least one of their properties. So naturally they are concerned about how they will fund the job, find someone to do it, and complete it on time.
“The side effect of these concerns is that a significant number of homeowners admit they are willing to give up and are already considering selling properties.
“An unintended consequence of this sentiment could lead to a setback in achieving the government’s climate change target, for example, if these properties are occupied by the owner-occupied market, where there are currently no minimum requirements. energy efficiency.
“Working with the industry to understand how best to help homeowners improve the energy efficiency of their properties and the time frame in which they can do so can ultimately lead to a better outcome for everyone.
And Timothy Douglas, Head of Policy and Campaigns at Propertymark, comments: “As home energy use accounts for 14% of UK global emissions and 90% of homes in England currently use fossil fuels, the improving the energy efficiency of the country’s building stock is one of the most important. challenges to achieve net zero emissions.
“If the alarming number of homeowners who have considered selling in the TMW report continue to do so, it will have a negative effect not only on the government’s ambitions of reaching net zero, but also on the thousands of tenants looking to be housed as stock levels run out.
“In some parts of the market, this will place additional burdens on local authorities and increase demand for social rental housing, as not everyone can afford to buy.
“To support the longevity of the private rental sector, the government must introduce realistic and achievable targets that take into account the diversity of the country’s housing stock. In addition, without incentives and sustained financing options that homeowners can tap into, the government’s energy efficiency proposals are unlikely to be met.