On 23rd September 2023, UK Prime Minister Rishi Sunak announced significant changes to energy efficiency targets for UK households, including rental properties. The announcement came after the UK Government considered concerns over the financial burden on property owners, including landlords, who would have had to make costly upgrades within a short timeframe.
Under the original plan, new rental properties were required to have a minimum Energy Performance Certificate (EPC) rating of at least 'C' by 2025, and all properties to achieve a 'C' by 2028.
However, the announcement stated that homeowners and landlords will not be forced to upgrade the energy efficiency of their properties, but instead the UK Government will continue to encourage households to do so where they can.1
The announcement also included delaying the proposed ban on gas boilers in new homes to 2035, and offered assurances that Britons would not be compelled to replace their gas boilers with heat pumps until they were due for replacement. To support the transition, the boiler upgrade scheme, offering cash grants to switch to heat pumps, will be increased by 50% to £7,500.
While Blackfinch Property welcomes Government-led initiatives designed to ease financial burdens on homeowners and landlords, we wanted to reaffirm our commitment on sustainability, and our desire to support brokers, borrowers and property developers wanting to create positive, sustainable, long-term change that helps communities, businesses and individuals to thrive.
We remain convinced that energy efficiency is one of the key pathways towards net zero carbon emissions, and that higher energy efficiency standards will help the UK achieve its goal of net zero by 2050, a goal which Prime Minister Sunak reaffirmed in his announcement.
Therefore, we will continue to apply our sustainability-driven lending criteria, where minimum energy efficiency standards are required and exceptional energy efficiency standards are rewarded by discounted interest rates. We believe this is the right approach for our risk management framework, for the brokers and developers we partner with, and for society as a whole.