Mortgage advisers could be doing more on EPCs

Mortgage advisers could be doing more on EPCs

Mortgage advisers could be doing more when it comes to conversations around energy performance certificates and energy efficiency in properties, the Mortgage Advice Bureau has said.

The comments were made after a survey by the mortgage intermediary revealed that only one in 10 of the 2,000 respondents had spoken to their mortgage adviser about a property’s EPC.

The survey also revealed that two-thirds of homeowners had no idea of the government’s target for properties to have a minimum of a grade C EPC rating by 2035, or the shorter deadline of 2025 for private rental accommodation.

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At the moment new rental properties must only have a rating of F or G but under government proposals all tenancies should be rated C by 2028 while new tenancies should be rated C or above by 2025.

Mortgage adviser and managing director of Henchurch Lane Financial Services, Paul Holland said these changes are coming at landlords “like a high speed train with no brakes, and landlords must ready themselves for impact.”

According to the Department for Business, Energy and Industrial Strategy, 46 per cent of all homes currently have an energy efficiency rating of C or above, up from 13 per cent in 2010.

Holland pointed out this means many landlords will need to invest a lot of money to ensure properties are up to date.

His advice for landlords is to use an accredited energy performance assessor as their prices are reasonable and they will be able to provide some ideas on how to maximise a rating - for example by installing some additional insulation.

Difficulties for landlords

According to Holland, the proposed new regulations could signal some issues for landlords who wish to sell their properties.

“They may have an issue if they wish to sell a property that is not meeting regulation with a low EPC, they will certainly struggle to sell this to another buy-to-let investor,” Holland told FTAdviser.

He also noted that the proposed changes may cause issues for landlord’s whose properties cannot meet the criteria.

“Some homes have been designed and built in a way they need to breathe, unfortunately this doesn’t help when you are battling to keep the heat in. 

“Around 10 per cent of homes in the UK are currently unable to achieve a C rating. What does this mean for them? What will the government do to help these people?,” Holland asked.

His number one tip for advisers when it comes to EPC ratings is to address the topic with clients as soon as possible.

“Early talks with landlords are key to meeting deadlines and rather than wait until the eleventh hour it might be a good idea for the landlords to take action now, and spread the cost over the next few years,” Holland said.