Despite the government's decision to abandon proposed energy efficiency regulations, recent research by Paragon Bank suggests that 37% of portfolio landlords are actively upgrading their properties to achieve an Energy Performance Certificate (EPC) rating of 'C' or higher. This data is part of Paragon Bank's Portfolio Landlord Report 2024.

Additionally, the research indicates that 32% of portfolio landlords already possess properties with EPC ratings of 'C' or above.

However, some landlords are hesitant to invest in upgrades without clear legislative direction, with 16% postponing any improvements until new regulations are enforced.

Meanwhile, 10% of landlords stated that the change in proposed rules has no impact on their portfolio strategy.

The survey, which included nearly 400 landlords owning four or more properties, also provides insights into timelines for completing green upgrades: 28% aim to achieve EPC 'C' within one to two years, and 22% expect it to take three to four years. Another 18% believe they will complete the upgrades within the next year, while 17% anticipate it taking five years or more.

This research follows Prime Minister Rishi Sunak's announcement that the planned changes to Minimum Energy Efficiency Standards, requiring all properties let for new tenancies to have a minimum EPC rating of 'C' by April 2025, have been discarded.

Despite these regulatory shifts, the private rented sector (PRS) seems to outperform owner-occupied homes in terms of energy performance. According to the English Housing Survey, 44.9% of PRS properties were rated between EPC 'A' and 'C' in 2022, compared to 43.3% in owner-occupied homes.

Richard Rowntree, managing director of mortgages at Paragon Bank, commented on the proactive measures taken by landlords: “It’s encouraging to see portfolio landlords continuing to enhance their properties so they meet EPC 'C' or higher, despite the proposed regulations being shelved."

Louisa Sedgwick, commercial director of mortgages at Paragon Bank, also noted: “We often see landlords release capital from existing properties in their portfolio to fund expansion or property upgrades. With mortgage rates lower than last year, we are seeing increased interest in remortgaging across the market to support landlord growth ambitions."