The UK property market is in turmoil as recent policy decisions bring unexpected changes for landlords and tenants alike. Prime Minister Rishi Sunak’s decision to alter the Energy Performance Certificate (EPC) targets has ruffled feathers and stirred concerns. Let’s look at the industry’s reactions.
Setting the Stage: What Are the EPC Changes?
The government had originally set forth a mandate that all rented properties would need to attain a minimum EPC rating of C by 2025. This was aimed at promoting energy efficiency in homes, ensuring lower energy bills for tenants, and mitigating the environmental impact of housing.
However, there’s a twist in the tale. The deadline has been extended to 2028, giving landlords a few more years to make the necessary adjustments. Additionally, the prohibition on new oil and gas boilers and coal heating for homes off the gas grid, originally set for 2026, has now been pushed to 2035. And in an unexpected turn, the poorest households will now be exempt from the gas boiler ban.
The Industry’s Reaction: Concern and Frustration
Jonathan Daines, founder and CEO of lettingaproperty.com, vocalized the frustrations of many in the property sector. His sentiments revolved around the unexpectedness of the decision, especially after numerous landlords had already made significant investments in anticipation of the original deadlines.
“The government’s U-turn… is frustrating for our landlord clients, many of whom have already taken steps to ‘do the right thing’ in preparation for change,” he remarked. In light of the looming EPC changes, many landlords had actively enhanced the energy efficiency of their properties, bearing the associated costs and inconveniences.
Paresh Raja, head of specialist lender Market Financial Solutions, echoed these sentiments. Highlighting the financial and practical burdens borne by landlords in preparation, he emphasized the uncertainty such policy shifts bring to the market. “The decision brings further uncertainty into a property market that would benefit from greater stability,” Raja noted.
Some Respite, But At What Cost?
While the policy shift does bring short-term relief to landlords, alleviating the immediate need for upgrades, the long-term implications are a source of worry for many. Ben Beadle, CEO of the National Residential Landlords Association (NRLA), expressed the need for properties to be as energy efficient as possible but acknowledged the existing policy uncertainties. He believes the onus is on the government to provide clarity and support for landlords aiming to improve energy efficiency in their properties.
The Broader Environmental Perspective
Don McLean, CEO of climate tech firm IES, came down hard on the decision, highlighting the broader implications for the environment. The building sector, he noted, is second only to surface transport in terms of climate emissions. While landlords might save in the short term, it’s the tenants who will bear the brunt of these changes.
“Homes with poor energy efficiency ratings use and waste more energy, the costs of which remain sky-high amid a cost of living crisis,” McLean pointed out. He warned of the potential discomforts for occupants, especially in extreme weather conditions.
Looking Ahead: A Call for Clarity
The consensus among industry experts is clear. While short-term relief might seem appealing, the long-term vision for a sustainable and green property market must not be lost. As the property industry grapples with these sudden changes, one thing is certain: clear guidelines and consistent policy decisions are essential for a future where both landlords and tenants can thrive in an environmentally conscious market.