Mortgage brokers will play a decisive role in helping landlords prepare for tougher Minimum Energy Efficiency Standards (MEES).
That’s the view of Neil Cobbold, commercial director of property software firm Reapit.
He says new Environmental Performance Certificate (EPC) standards – part of MEES – create responsibility and opportunity for brokers: to educate landlords, signpost appropriate finance options, coordinate retrofit activity, and use portfolio data more strategically to identify potential value in new investment properties and risk with existing stock.
“By partnering with specialist brokers, [letting] agents can further access advice on a range of financial products that allow landlords to improve the energy efficiency of their properties, giving landlords a professional support network to help them reach the higher EPC C standard.
“Agents who embrace this role could unlock a significant new revenue stream. With the cost of the private rental sector (PRS) retrofit programme estimated at £24 billion, those who combine technology with industry expertise stand to earn substantial commission while strengthening long-term relationships with landlords.”
A recent Reapit analysis of agency-managed PRS properties highlighted the massive scale of the industry’s obligation to attain energy efficiency. Some 51.5% of PRS homes in question were below EPC band C, with 17.4% rated E, F or G.
Reapit’s data indicates that around £24 billion in retrofit investment would be required for privately rented homes in Britian to reach the government’s proposed standard. In England and Wales, PRS properties must achieve EPC grade ‘C’ by 2030, while under Scottish draft plans, landlords there have until 2033 to reach a similar standard.
Cobboldsays a perfect storm of policy uncertainty, rising costs and limited retrofit capacity is creating inertia in the PRS.
“There is a nervousness over timeframes, which is creating a supply and demand issue, which in turn causes extra financial pressure for landlords who are looking for a solution.
“All of this uncertainty makes it more difficult for us to do what needs to be done – make these homes more energy-efficient and help people not only in making their homes better but actually taking them out of fuel poverty.”
He adds that ongoing uncertainty around government consultations and enforcement continues to stall action.
Cobbold warns that clear guidance on enforcement or exemption thresholds, many landlords are simply being advised to wait and see, resulting in a shrinking window for action, rising costs as landlords are forced to compete nearer the deadline for a limited number of skilled tradespeople, and increased compliance risk.
