Landlords in the UK are facing significant challenges in meeting the Labour government’s 2030 target for all privately rented homes to achieve an Energy Performance Certificate (EPC) rating of A to C. Research from Hamptons reveals that if energy efficiency improvements continue at their current rate, it would take until 2042 for all rented homes to reach the desired standard—12 years beyond the proposed deadline.

This marks an improvement from the 89 years it would have taken at the 2016 rates, which saw many landlords begin preparing for previous, now-abandoned Conservative EPC plans. To meet the 2030 goal, around 340,000 rented homes would need to upgrade their EPC rating to C or higher each year, which is triple the number expected to achieve this in 2024.

Aneisha Beveridge, head of research at Hamptons, highlighted the difficulties landlords face due to frequent changes to proposed energy efficiency rules, which have shifted the goalposts, leading to potential costs that could reach tens of thousands of pounds for some landlords. Despite these challenges, many investors have continued to improve the energy efficiency of their properties. Currently, the sector is on track to have 100% of viable rental homes reach an EPC rating of A-C within a generation. However, to achieve the government’s 2030 target, the pace of upgrades needs to match the number of improvements made in the last 30 years within just the next five years.

Currently, 55% of privately rented properties have an EPC rating of C or better, exceeding the 48% rate for owner-occupied homes. While half of homes previously rated D have improved to at least a C rating upon reassessment, only 9% of C-rated homes have moved up to a B or higher. Additionally, Hamptons’ data indicates that 3-4% of rented homes may be unable to achieve an A-C rating due to factors such as the age of the property, its location, and changes in EPC methodology. These homes, often older and cheaper, are predominantly located in the North of England and typically offer higher rental yields.

The financial benefits of upgrading homes are clear, with tenants saving an average of £499 per year when moving from an EPC D to C rating, a 76% increase since 2019. For homes with an EPC E rating, the savings are even more substantial, averaging £1,248 per year. However, to meet the 2030 target, landlords will require clear guidance, sufficient time, and adequate resources. Beveridge stressed the importance of providing landlords with complete clarity on this target within the current year to enable them to make the necessary preparations.