Posts with tag: The Mortgage Works

Landlords lacking confidence to improve property energy efficiency

Published On: September 3, 2021 at 8:07 am


Categories: Landlord News

Tags: ,,

Landlords are lacking in confidence when it comes to improving the Energy Performance Certificate (EPC) rating of their properties, research from The Mortgage Works (TMW) shows.

With less than four years left until the Government wants all new private rented tenancies to be in properties with an EPC rating of at least ‘C’, this research highlights a number of challenges.

Current legislation in England and Wales requires buy-to-let properties to have at least an EPC rating of ‘E’ or above. However, in order to improve the energy efficiency of rental properties, the Government wants to increase the requirement to a ‘C’ rating for all new tenancies by 2025 and for all existing tenancies by 2028.

A poll of around 750 landlords found 35% of respondents are not confident they will be able to bring their properties up to the required energy efficiency standard.

The research highlights issues such as property constraints, which more than half (51%) think will be a hurdle.

Property constraints (i.e. limitations on what is possible for the building)51%
Access to the property whilst tenants are renting44%
Level of disruption required to carry out the work44%
Limited payback on any investment44%
Limited tangible benefit to the tenants35%
Finding reputable tradespeople34%
Finding available tradespeople30%
Hassle of managing the extra work27%
Knowing what is required/appropriate27%
Lack of funds27%

14% of landlords say they will need to spend all of their annual rental income, perhaps more, on making improvements to their properties. However, 29% say they will need to spend less than 30% of their annual rental income. 17% responded that they won’t need to spend any money at all.

Funding side, 11% of landlords admit they have no idea of what work is required and don’t know where to start. 41% say they have either a good or clear idea on what to do. That figure increases to 55% of those with 20 or more properties in their portfolio.

Daniel Clinton, Head of The Mortgage Works, said: “Given the concerns and challenges facing landlords in not only making the necessary improvements, but financing them, it’s perhaps no surprise that more than a third of landlords are not confident they will be able to bring their properties up to the required EPC ‘C’ standard.

“As more than two in five landlords say a lack of funds or access to finance is one of the biggest challenges they face in greening their properties, we are doing our bit to support them with the recent introduction of our Green Further Advance product, with rates up to 50% lower than our standard further advance products. It’s also great to hear that the Government would like to introduce a new financial support package to help people improve the energy efficiency of their homes, however, we hope that any such scheme would also be open to helping landlords meet their requirements.”

UK renters could be pushed into poverty by government benefit cuts

A joint statement warning about the impact the UK Government’s benefit cuts could have on renters has been released this week.

The Big Issue Ride Out Recession Alliance, Crisis, The Mortgage Works, Nationwide Building Society, the National Residential Landlords Association (NRLA), Propertymark, StepChange Debt Charity, and Shelter have together released this statement:

The UK Government must complete and publish a full assessment of the impact on renters of their decisions to freeze Local Housing Allowance and cut Universal Credit, which risk pushing many households into poverty, problem debt, and homelessness.

In the wake of the pandemic, we saw bold and swift action from the Government to prevent a housing debt crisis including restoring Local Housing Allowance rates to the 30th percentile of market rents and increasing the Universal Credit Personal Allowance.

With the economic impact of the pandemic increasing the financial strain on families, across the country the number of private rented households in receipt of the housing element of Universal Credit increased by 107% between February 2020 and February 2021. Over 55% of these households have a shortfall between the housing support they receive and the rent they have to pay. 

The UK Government has confirmed that where such shortfalls exist, the median amount is £100 a month. This points to a need for continued support for families and individuals to cover the cost of rents. Yet since April this year, Local Housing Allowance has been frozen in cash terms, and later this year, Universal Credit will be cut by £20 a week. 

Whilst the Institute for Fiscal Studies has described changes to Local Housing Allowance as “arbitrary and unfair” we have seen no assessment from the UK Government of the impact either of these policies will have on the capacity of recipients to cover rent payments. 

As organisations representing landlords, letting agents, tenants, people facing homelessness, and debt advice services, we are united in calling on the UK Government to complete and publish a full assessment of the impact of both of these policies on the ability of renters to meet their housing costs.

We believe that the UK Government should reverse its decisions to cut Universal Credit and to freeze Local Housing Allowance. To apply policies like these without doing any meaningful impact assessment is, we argue, lacking the necessary foresight and consideration of the impact they will have on people’s security of tenure and well-being and for many will threaten their chance of recovery.

Chancellor called on to tackle the UK rent debt crisis

A joint statement has been made by The Big Issue Ride Out Recession Alliance, Crisis, Citizens Advice, Joseph Rowntree Foundation, Money Advice Trust, The Mortgage Works, National Residential Landlords Association, Nationwide Building Society, Propertymark, StepChange Debt Charity, and Shelter.

The statement calls on the Chancellor to take action in order to tackle the rent debt crisis:

“At least half a million private renters are in arrears due to the economic impact of COVID-19. The UK Government’s own research shows that ‘private renters report being hardest hit by the pandemic’.

“Renters and landlords whose finances have been affected since lockdown cannot keep tenancies going without additional financial support.

“We welcome many of the measures taken to date, which have helped to sustain tenancies in the short term. But they do not go far enough to adequately protect renters going forward.

“The longer the Chancellor waits to take action, the more rent debts will increase, and the greater the risk of homelessness will become. Without additional support, more renters will lose their homes in the coming months, with the risk of an increase in homelessness.

“As organisations with the aim of sustaining tenancies wherever possible we consider that this requires two things in the forthcoming Budget.

“First, a targeted financial package to help renters pay off arrears built since lockdown measures started in March last year. This will help to sustain existing tenancies and keep renters in their homes – whilst also ensuring rental debt does not risk them finding homes in the future.

“Secondly, we need a welfare system that provides renters with the security of knowing that they can afford their homes. The pandemic has shown how vital this is to providing security at a time of crisis. The Government increased Universal Credit and Housing Benefit because it recognised that the system was not doing enough to support people in the first place, yet it has chosen to freeze Housing Benefit rates again from April and is considering cutting Universal Credit at the same time. It cannot be right that these measures could be pulled away from renters during continued economic uncertainty.

“We urge the Chancellor to act now to avoid renters being scarred by debts they have no hope of clearing and a wave of people having to leave their homes in the weeks and months to come.”