A recent survey of 500 landlords* found that 59% would exit the market if the expected deadline of 2028 to upgrade properties to a minimum EPC C rating is introduced.
This new legislation could make it challenging for landlords to purchase additional buy-to-let (BTL) properties or upgrade existing properties which require works to be carried out in order to raise the EPC rating.
To help the landlords overcome this challenge, CHL Mortgages offers an innovative suite of three refurbishment products: Light Refurbishment, Cosmetic Improvement and EPC Improvement. The first two products are designed to increase the future asset/rental value of the property, with the latter a Green Mortgage option which is specifically designed to enable the Landlord to improve the energy efficiency of the property.
Our Refurbishment Range of BTL mortgages could offer solutions to landlords facing an EPC ratings challenge, as the products offer the ability to release the refurbishment costs upon completion of works without changing the mortgage product. No need to bridge. No need to switch.
Landlords we have helped improve their properties.
18% of our mortgage applications during quarter 4 in 2022 were received from landlords looking to improve the condition of their rental property by using the refurbishment product options.
These Landlords have spent on average £24,587 on improvements (12% of pre works value), however, the resulting post works value has increased on average by £58,000 (22% of pre works value).
On top of this, the properties command top rental demand due to their improved desirability.
EPC improvement product
This product is designed for landlords looking to improve the energy efficiency of their BTL property to meet the UK Government’s proposal for existing rented properties to have a minimum EPC rating of C or higher from 2028.
Examples of acceptable works
Ross Turrell, Commercial Director, CHL Mortgages, commented:
“This product range has been designed and developed in line with feedback from our intermediary partners. A growing number of landlord clients are looking for a product that offers a single, one-stop solution that removes uncertainty around funding refurbishment, supported by a simple process.
This alternative Green Mortgage product is more than a simple pricing play and provides an additional and viable option to alternative forms of finance such as ‘bridging’ whilst helping to reduce administrative burdens and save on multiple inspection and legal fees.
By implementing these small changes, landlords can significantly improve the energy efficiency and EPC ratings of their rental properties, which can lead to lower energy bills and increased tenant satisfaction.”
* Survey conducted by Mortgage Advice Bureau (MAB) 17/04/2023
Energy efficiency benefits for all