Landlords will miss green upgrade targets by 18 years if improvement work continues at the current pace, according to research from Hamptons.

It will take until 2042 for all rented homes to achieve an energy performance certificate rating of between A to C, says the property agent, rather than the 2030 the new Labour government targets.

So far this year, 39% of energy performance certificate reviews carried out on existing rental homes have seen the property move into a higher band, up from 34% a decade ago.

The data also comes as average newly let home rents rose 5.7% to £1,354 per month across the UK over the last year, with prices in Northern England rising three times as fast as London.

Last week, parliamentary under-secretary of state for the Department of Energy Security and Net Zero Miatta Fahnbulleh said it will reinstate plans for private rented properties to hit the energy performance certificate C standard by 2030.

This comes after former Conservative Prime Minister Rishi Sunak abandoned, or rolled back, this, and a range of other green targets last September, amid the cost-of-living crisis.

Hamptons says: “This means it would take until 2042 for all rental homes to become compliant with the new rules suggested by Labour.

“While this is later than the government’s 2030 target, it still represents an acceleration from the 89 years it would have taken at 2016 rates.

“This is partly because some landlords have already been making energy upgrades to meet the Conservative’s plans that were scrapped last year.”

The firm adds that so far this year 55% of all landlord properties that had a new energy performance certificate granted achieved a rating of C or better, compared to 48% of owner-occupier homes.

The average energy efficiency rating for a dwelling in England and Wales is band D, according to official data.

Hamptons head of research Aneisha Beveridge says: “Successive changes to proposed energy efficiency rules have shifted the goalposts for landlords, some of whom face costs which can run into tens of thousands of pounds.

“To meet the government’s 2030 target, the same number of homes will need to see energy upgrades over the next five years as we’ve seen make improvements in the last 30 years.”

Also, the property agent adds that nationwide 5.7% annual rent rises, were buoyed by double-digit hikes in the North of England.

It points out that outside London, rents rose 7.2% year-on-year, driven by a 10.3% annual increase in the North of England where rents have been accelerating since March.

Rents in the North — North East, North West and Yorkshire & Humber — are rising three times faster than in London, where the average rent on a new tenancy increased 30% year-on-year to £2,355 per month, down from the 13.9% increase recorded in the capital in July last year.

Hamptons’ Beveridge adds: “Rental growth continues to outpace inflation, despite the pace of growth moderating over the last year.

“However, there are also signs that the large increases in stock levels since 2023 are beginning to subside. In January, stock levels were up 34% year-on-year, a figure which is now 22%.

“A fall in stock levels is likely to reignite the pace of rental growth, particularly given that longer-term there are around a third fewer rental homes than there were five years ago.”

The post Landlords to miss green upgrade targets by 18 years: Hamptons   appeared first on Mortgage Strategy.