Landlords lead the way on energy efficiency

With new Energy Performance Certificate laws for the rental sector less than four weeks away, landlords have shown that they are ahead of the game when it comes to improving the energy performance of rental property.

Research by Paragon Mortgages reveals that the majority of landlords have made improvements to a residential investment property since purchase to help improve its energy efficiency.

Over half (56%) of landlords have installed a new boiler into a rental property since purchase, while 62% have installed double glazing. Meanwhile, a third have laid insulation to prevent heat escaping from the roof of a property - one of the most effective measures in improving a property's energy performance.

From 1 October 2008, landlords offering property for rent will be legally required to provide tenants with an EPC. Failure to comply with the legislation will result in a £200 fine and the landlord being unable to market the property until they obtain the certificate.

Despite the high number of landlords installing energy efficient measures, only 12% are aware of the Landlord Energy Savings Allowance. This allows landlords to offset the cost of installing energy saving measures, including loft, cavity wall and floor insulation, against income tax, up to a value of £1,500.

Paragon Mortgages has produced an interactive guide for landlords on EPCs, ‘The Landlords' Guide to EPCs', which can be downloaded from the paragon-epcs.co.uk website. Landlords can also order their EPCs from this website.

John Heron, Paragon Mortgages managing director, says: ‘Landlords are committed to improving the standards of private rented accommodation and since 1995 there has been a marked improvement in the standard of private rented sector stock due to increased investment from residential property investors.

‘Every landlord wishing to market a property for let will require an EPC, so it is likely that the rating of their property will add to the factors that a potential tenant will consider. Lower fuel and energy costs are important, particularly given the rising cost of energy, so a property with a high energy efficiency rating is likely to be a winner.'

Heron adds: ‘Landlords should be aware of the financial assistance available to them to improve the energy performance of their properties. The Government has highlighted reducing domestic energy as a key target, so landlords need to take advantage of the financial help that it is offering.'

However, Paragon's research shows that while landlords are undertaking major work to improve a property's performance, they could also introduce minor measures to lift a property's energy efficiency. For example, only 33% have installed energy saving light bulbs and 18% have purchased energy efficient electrical appliances, despite the relative low cost of both measures.