The majority (78%) of landlords are concerned about upcoming Energy Performance Certificate (EPC) regulations requiring rental properties to achieve a Band C rating or above by 2030.
Of those surveyed, 29% stated that the targets are only realistic with Government assistance, while 16% would struggle to afford the costs associated with reaching this target.
Additionally, a quarter (25%) of landlords said they plan to sell properties that require upgrades.
Despite these concerns, more than a fifth (21%) have made changes to improve their EPC rating following previous Government discussions on the targets.
Among landlords with four or more properties, 25% reported making upgrades, compared with 17% of those with one to three properties.
Shawbrook’s research in 2022 indicated that many landlords had been improving their properties in response to rising energy costs and tenant demand.
However, uncertainty surrounding the targets led some to pause their renovation projects.
Emma Cox, MD of real estate at Shawbrook, said: “Our experience has shown that landlords overall are motivated to improve their properties.
“In 2022 we saw many take steps to do so both in response to demand from their tenants, and the-then targets from the Government.
“However, when these targets came into question, at a time of significant economic headwinds, many chose to hold off on costly renovation projects.
“With these targets back in place, landlords now must play catch-up.
“It’s encouraging to have greater clarity from the Government which will allow landlords to put in plans in the run-up to 2030, but with just over five years left to comply it’s clear that landlords will need support to get there, both from the Government and the industry.
Cox added: “When you consider the housing stock in the UK, much of which was built prior to 1950, the extent of the challenge is clear.
“According to the English Housing Survey, 12% of the private rented sector is currently rated E to G.
“It’s also worth acknowledging that the cost of improvements is consistent nationwide, but the impact is disproportionately higher for landlords with lower-value properties, making a £10k investment far more burdensome in the North than in London, for example.
“Having a quality, energy-efficient, professional private rented sector is critical, particularly at a time when home-ownership and access to affordable housing remains challenging.
“But this must be achieved with the support from Government and industry.”
