Property refurbishments are becoming increasingly important for landlords as the Government prepares to force the sector to upgrade properties to minimum levels of energy performance by 2030.

Financing these projects, whether it’s to raise a property’s EPC certificate or to upgrade its quality and therefore rentability, is often the biggest challenge for landlords, says broker Mortgage Finance Brokers (MFB), whether landlords are buying properties or improving existing ones.

And despite a recent Labour Government promise to give landlords more financial help in England, many landlords will still need to find significant sums to complete their projects, says MFB Business Development Director Jeni Browne (main image).

“I think landlords are more aware of the requirements that are coming down the line and I think that’s influencing their property buying decisions, but it’s been difficult as the EPC requirements have changed as different governments have changed what’s needed and by when, “ she says.

“So, while last year many landlords thought tougher minimum EPC requirements had been rejected, they’ve had to switch back on as Labour has brought them back in – or at least has promised to.

“Many are now prioritising this and we’re seeing this among our clients already.”

When it comes to upgrading existing properties or buying new ones, Browne says landlords have several choices. This includes remortgaging and many lenders have specific products available depending on whether it’s a ‘green upgrade’ or refurbishing a tired property.

“It’s all about how long it takes to do the work – insulation and heating replacement work can take weeks and even months so for that landlords will need some sort of bridging loan, while if it’s just doing up the interior then this won’t take so long and a straightforward mortgage is probably a better idea,” she adds.

“That’s because buy-to-let mortgage lenders want to know there is rent being paid; their calculations are based on that, not whether you the landlord can afford to cover them while the work is done – so many landlords buy properties via bridging loans while the upgrade work is being done – whether it’s to get them a minimum EPC level or so that they are lettable – and when the work is competed move across to a buy-to-let mortgage.”

Browne adds that many landlords don’t realise the range of options open to them, and for example many lenders now offer cheaper interest rates if properties are an EPC band C or above.

To find out more about all of this join LandlordZONE and MFB for a free webinar hosted by Paul Shamplina on October 8th. Sign up here to register.