11 Aug Is It Worth Making Your Rental Property More Energy Efficient?

With rising energy costs putting increasing pressure on household budgets, landlords and tenants alike are looking for ways to improve the energy efficiency of UK rental properties. Not only can this help reduce bills, but it is also necessary in the fight against climate change. “Energy use in homes makes up 23 percent of the UK’s greenhouse gas emissions – more than double the amount from agriculture, and nearly as much as all transport emissions,” says one recent report.

By law, all private rented domestic properties on an assured or regulated tenancy in the UK must have a valid EPC rating to satisfy the government’s Minimum Energy Efficiency Standards (MEES). It is currently unlawful to let a property with an EPC rating below E, with the required minimum rating due to be raised to C by 2030.

But there is no reason landlords need to stick to the most basic requirements, and this article provides practical tips and advice for both landlords and tenants on enhancing the energy performance of rental accommodations.

With the right improvements, landlords can potentially achieve higher rents and faster lettings, while tenants can enjoy greater comfort and lower utility bills. But more importantly, by working together, we can all play a part in reducing the environmental impact of UK housing.

What constitutes an energy-efficient home?

When it comes to improving energy efficiency in a home, not all changes make an equal difference. Focusing on upgrades that have the biggest impact on performance is key. “Rental homes that are more energy efficient will have a lower carbon footprint as well as lower outgoings, making these properties more attractive to tenants which, in turn, will benefit landlords both in the short and long term,” one London property expert points out.

Here are some of the most important improvements that contribute to creating an energy-efficient home.

• Adding insulation in the loft, walls, and floors greatly improves efficiency by reducing heat loss. Around 25% of heat escapes through uninsulated roof space, 35% through walls and 25% through floors.

• Replacing single glazed windows with modern double or triple glazing reduces draughts and heat loss, improves sound insulation and generally makes the home a cosier place to live.
• Installing a modern A-rated condensing boiler that can operate at over 90% efficiency compared to 60-70% for an older gas central heating boiler
• Replacing old washing machines, dishwashers and fridges with A++ or A+++ rated appliances
• Replacing light bulbs with LED bulbs that use around 90% less energy than conventional halogen bulbs
• Using simple draught-proofing measures to seal gaps around windows, doors, floors, skirting boards and pipework
• Installing smart thermostats and controls to automate heating based on occupancy and lifestyle patterns and avoid energy waste
• Generating renewable electricity from rooftop solar panels can substantially reduce reliance on grid electricity while generating extra income from selling surplus solar power back to the grid.

Will greener homes let better and for more?

There is increasing evidence that energy-efficient homes let more quickly and can achieve higher rental yields for landlords. Tenants are progressively more concerned about sustainability and lowering utility bills, so eco-friendly features give properties a competitive advantage.

Homes with better Energy Performance Certificate (EPC) ratings tend to see higher tenant demand. Properties rated A/B attract 10% higher rental rates on average compared to those rated D/E. Energy efficiency credentials also make listings more appealing. 78% of prospective tenants said energy performance was an important factor when viewing properties, according to recent survey findings.

Additionally, with greener homes letting faster and with fewer void periods between lets than conventional properties, landlords are realising a greater rental income potential across the year. Making sensible energy efficiency upgrades need not be expensive (though they can be a serious investment into improving the property). However, the resulting savings on energy bills can often quickly repay the investment through higher rents.

Improving the environmental performance of rental homes makes good business sense for landlords. It taps into growing tenant demand for sustainable living, leads to faster lettings, lower voids, and potentially 20-30% higher rental yields over time. Going green, one can argue, is future-proofing rental properties.

What can landlords and tenants do?

Improving the energy efficiency and sustainability of rental accommodations requires engagement from both property owners and occupants. Landlords and tenants each play an important role and have opportunities to increase efficiency through upgrades, maintenance, and daily usage habits. By working together, rental housing can collectively achieve better environmental performance, lower energy bills, and greater comfort for all.

Here are some practical tips to consider:

For landlords:

• Conduct an energy audit to identify efficiency opportunities
• Invest in insulation, draught-proofing, glazing, and heating upgrades
• Install LED lighting, thermostats, and smart meters
• Communicate improvements to tenants and during lettings
• Consider renewable energy additions like solar panels

For tenants:

• Request energy efficiency details when renting
• Understand rights under rental regulations regarding MEES
• Speak to the landlord about issues like mould or draughts
• Use power and heating wisely, turn off unused lights/electronics
• Turn the thermostat down by 1 degree to save on heating bills
• Avoid using portable gas/electric heaters as these rack up bills
• Use heavy curtains in winter to reduce heat loss through windows
• Fit reflective panels behind radiators to direct heat into rooms
• Seal small draughts yourself with cheap DIY materials
• Limit the use of tumble dryers and dry clothes on racks instead

A greener future for all

In conclusion, improving the energy efficiency and sustainability of rental homes is important for tackling rising costs and climate change impacts. Even small upgrades like LED lighting and draught-proofing bring benefits. But combining these simple fixes with more significant investments in insulation, glazing and heating can transform the environmental performance of rental properties.

Crucially, landlords and tenants need to work together. Property owners should make appropriate improvements and communicate these to occupants. Meanwhile, tenants should utilise energy responsibly and think green when renting.

With the right collaborative approach, the UK’s rental sector can significantly reduce its carbon footprint. Greener, more efficient homes mean lower bills and greater comfort for inhabitants. As tenants increasingly demand sustainable housing, upgrading homes makes business sense for landlords too, leading to higher rents, faster lets and lower voids. There are opportunities for everyone to take action.