Green Home Regulations Could Require Buy-to-Let Landlords to Invest Up to £20,000 on Older Properties

The UK government's push for greener homes is having a significant impact on the buy-to-let market, with landlords now facing the prospect of spending up to £20,000 to bring older properties up to standard.

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New Minimum Energy Performance Standards for Buy-to-Let Properties

Under new Energy Performance Certificate (EPC) regulations, rental properties must have a rating of at least E, meaning they must have energy-efficient features such as insulation, double glazing and efficient heating systems. However, the government is now proposing to raise the minimum standard to a C rating by 2025, and a B rating by 2030.

While the goal of creating greener homes is a laudable one, the impact on buy-to-let landlords has been significant. Many landlords are struggling to find the money to make the necessary upgrades, particularly as they have already been hit by tax changes and increased regulations in recent years. Click here to find out more about tax efficient property investment.

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£20,000 Invested into Upgrading Buy-to-Let Properties

According to a report in This Is Money, some landlords have already spent over £20,000 on upgrading their properties, and many others are now considering selling up rather than investing more money in their buy-to-let portfolios.

One of the biggest issues facing landlords is the cost of insulation. While it is a relatively cheap and straightforward way to improve energy efficiency, many older properties were built without insulation and require significant work to bring them up to standard.

Another issue is the cost of replacing outdated heating systems. While newer systems are often more efficient, they can be expensive to install, particularly in properties where space is at a premium.

The government has said that it wants to help landlords make the necessary improvements, but many landlords are sceptical. Some have accused the government of using the new regulations as a way to force them out of the market, particularly as the changes come at a time when the buy-to-let market is already struggling due to the Covid-19 pandemic.

While creating greener homes is undoubtedly an important goal, it is essential that the government works with landlords to find a way to make the necessary upgrades without putting them out of business. This could involve providing financial support, such as low-cost loans or grants, or offering tax incentives to landlords who make the necessary improvements.

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Energy Efficient Property for Buy-to-Let Investors

Some landlords are now contemplating selling their buy-to-let properties instead of injecting further funds into them. Regency Invest offer a wide-selection of property in key cities in the UK for rental and price growth that are compliant with the forthcoming regulations, saving property investors significant outlay to upgrade existing non-compliant properties.

To find out more about Regency Invest's wide selection of investment property, please click here.

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