Landlords must not to drag their heels when it comes to improving properties’ energy efficiency rating - or face potential issues with finding tradespeople and working with letting agents, a bank director has warned.

Daryl Norkett, who is the director of real estate proposition at Shawbrook Bank, acknowledges that Government delays around EPC deadlines have driven inaction among many landlords.

In February, it finally announced that regulations would not be confirmed until late 2026, after which landlords will be expected to ensure any property subject to a new tenancy hits EPC C by 2028, with all other rentals following shortly behind in 2030.

It has set a maximum cap of £15,000 per property, with an affordability exemption which would lower it to £10,000 based on lower rents or council tax band.

Nervous landlords

However, Norkett said landlords are nervous about spending money on energy efficiency improvements now, as they fear it may not count towards the £15,000.

“While house prices go up over time and landlords should see capital growth in areas such as London and the South East, the case for spending £15,000 will be straightforward,” Norkett tells LandlordZONE.

“But I’m really worried about areas where you can buy a terraced house for £80,000 and don’t see as much capital growth. It’s hard not to see why you would sell up instead and if that then reduces rental supply, it’s a real issue.”

He advises landlords to get advice about how they can get to an EPC band C.

“If that cost is palatable…you can get access to that money and the property is worth the investment, it’s maybe best to do it now, particularly as there could be future challenges around getting builders and suppliers that might make it hard to get work done in time.”

Norkett also predicts that the letting agency industry will be quick to get on top of the new regulations and won’t want to work with landlords who aren’t compliant.

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