A recent study conducted by BVA BDRC Landlord Panel sheds light on the proactive measures taken by landlords in response to new energy efficiency requirements. According to the research, a staggering 80% of landlords have already undertaken remedial works on their properties. This surge in activity is attributed to both the anticipation of forthcoming government initiatives and the desire to maximize long-term property value.

Of those landlords who carried out improvements, 52% opted for the minimum cost required to comply with regulations. On the other hand, nearly two in five landlords (38%) invested in works aimed at enhancing the value of their properties over the long run. This shift in mindset is indicative of a broader trend among landlords who are recognizing the importance of energy efficiency in the rental market.

Interestingly, the study also reveals a decline in the number of landlords considering selling or not re-letting their properties due to these regulations. In the last quarter, 20% of landlords expressed such intentions, whereas the figure has now decreased to 13%. This shift indicates a growing commitment among landlords to meet the energy efficiency standards rather than resorting to alternative measures.

One of the key findings of the research is the awareness and understanding of the Energy Performance Certificate (EPC) requirements. The majority of landlords surveyed (85%) demonstrated a clear understanding of the anticipated future EPC level requirements. This figure marks a significant increase from the previous quarter, where only 65% of respondents showed the same level of awareness. It is worth noting that the future EPC level requirements are expected to encompass a minimum level of C and above for all rented homes by 2028, although this is yet to be officially confirmed.

George Gee, the managing director (commercial) at Foundation Home Loans, commented on the study's results, highlighting the positive intent of landlords in preparing their properties for future legislation. Gee also acknowledged the concerted information campaign by the industry, which has contributed to the rise in awareness and understanding among landlords regarding EPC requirements.

While the research indicates that a significant portion of landlords (80%) have already initiated remedial works, there remains the question of funding for further improvements. The study reveals that the majority of landlords (76%) plan to finance the works using their savings. However, there is a possibility that some landlords may need to explore alternative options, such as refinancing their rental properties through mortgages or loans, especially if they own multiple properties that require upgrades.

In light of the anticipated EPC level requirements, Gee emphasized the importance of ongoing conversations between advisors and landlords. These discussions should not be limited to the present but should also encompass future plans to ensure compliance with the regulations. By initiating these finance conversations early, landlords may seize the opportunity to carry out improvements across their portfolios and secure the necessary funding without delay.

As the countdown to 2028 continues, where compliance with EPC level C and above is speculated, it becomes evident that landlords must act proactively and make informed decisions regarding their properties. By staying ahead of the regulatory curve, landlords can safeguard their investments and contribute to a more energy-efficient rental sector.