The Telegraph is reporting that, in a significant development for the private rented sector, the Labour Party has confirmed that landlords will be allowed to reflect the cost of mandatory energy efficiency improvements in their rent prices.

Under Labour’s net zero plans, all privately rented homes must reach a minimum Energy Performance Certificate (EPC) rating of C by 2030. While the government claims this could save tenants around £240 a year in energy bills, new guidance suggests the costs of reaching this standard may be passed directly to tenants — with potential rent increases of up to £4,000 per year in some cases.

Justice Minister Sarah Sackman told Parliament that EPC upgrade costs are a “material consideration” in setting market rents, meaning landlords can legally increase rents to reflect these investments, even if a tenant appeals the rise.

What This Means for You:

• Rent increases to offset EPC upgrades are allowed under the Renters’ Rights Bill.

• Landlords should document upgrade costs clearly and keep records to support any rent reviews.

• A realistic and phased approach is recommended, especially for older or lower-value properties.

Industry bodies including Propertymark and the NRLA have voiced concern over the timeline and funding available. They warn that without more support, many landlords could exit the market — or pass on significant costs to tenants.

Next Steps for Landlords:

• Assess your property’s current EPC rating.

• Begin budgeting for likely improvements (e.g. insulation, windows, heating systems).

• Keep communication with tenants open and transparent.

• Explore available local authority grants and government schemes such as the Boiler Upgrade Scheme.

With compliance deadlines looming and the market becoming increasingly regulated, staying ahead of these changes will help protect your rental income and ensure you remain compliant with future legislation.