Government launches EPC grants for landlords with rent increase ban

Government launches EPC grants for landlords with rent increase ban

An EPC graph, Green outline of a house, Grant Funding and Gov UK sign with clouds in the background
9:44 AM, 2nd April 2025, 1 year ago 29

A new funding scheme for energy-efficiency improvements has opened to landlords in England, but landlords will be forced not to raise rents during the EPC works.

The Warm Homes: Local Grant scheme, which opens this week, will allow landlords with properties rated EPC D to E to receive up to £30,000 for improvements on their first rental property and up to £15,000 for additional rental homes.

However, the grants are only available to tenants who are on low-incomes and only in certain postcodes.

Landlords need to meet criteria

The government says landlords with properties rated EPC F or G will need to show proof of an exemption to qualify for the grant, otherwise, they won’t get the funding.

The government adds that they are focusing on improving the “energy performance and heating systems of low-income homes, where help is needed most”.

To apply, landlords need to meet three criteria:

  • Eligible postcodes: These are based on deprivation factors – you can check out a full list here
  • Benefit claimants: Tenants who are in receipt of certain benefits, including Universal Credit and housing benefit or who meet the existing ECO4 Flex Criteria.
  • Low-income households: Households whose gross income is below £36,000 a year.

The government says it will be up to councils to verify that applicants meet these criteria.

There’s no cap on the number of properties a landlord can apply for, but there is a maximum total payout. The upper limit is £315,000, which includes any previous grant funding received for upgrades.

Not result in an increase to rental prices paid by tenants

A document by the Department for Energy Security and Net Zero, reveals landlords won’t be allowed to increase rent during the energy-efficiency improvements.

The documents says: “Should landlords be eligible for Warm Homes: Local Grant funding, there is an expectation that energy performance upgrades and/or low carbon heating improvements will not result in an increase to rental prices paid by tenants.

“The Authority will carry out monitoring of this and reserves the right to amend policy to adjust or remove support to landlords/the PRS should evidence of rent increases be detected.

“The Authority also reserves the right to make policy changes to PRS support, should there be any changes in the wider policy landscape.”

All landlords who apply will be added to a central database of those taking part in the Warm Homes: Local Grant scheme.

Huge swathes of landlords will be left in the cold

The National Residential Landlords Association (NRLA) has previously said they welcome the funding but believe support should also be available for landlords who don’t qualify for the scheme.

Meera Chindooroy, the NRLA’s deputy director for campaigns, said: “The nature of the scheme means that huge swathes of landlords across the country will be, quite literally, left out in the cold.

“It’s also unclear if there will be enough to pay for improvements across the areas already selected to benefit.

“The PRS has some of the oldest, and hardest to improve, properties within the UK housing stock and what we would like to see is a comprehensive package of financial support available to landlords across the board.”


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Comments

  • Member Since April 2025 - Comments: 1

    6:40 AM, 3rd April 2025, About 1 year ago

    Rather than the government offering huge grants and then getting landlords to jump through hoops to get them and implimement them, a greater emphasis should be put into producing EPC assessment criteria which looks purely at the energy efficiency rather than incuding the running costs.
    This would allow many properties currently in the D rating to move to the C rating without doing anything or by just making a few tweeks.

  • Member Since May 2018 - Comments: 1999

    11:31 AM, 3rd April 2025, About 1 year ago

    Reply to the comment left by John Hill at 03/04/2025 – 06:40
    I agree with this (although I’m not convinced that it is in the public interest for tenants to be prevented from renting band D, E, or F properties if they either want or need to do it).

    But when the government changes the EPC system there needs to be a process built into the system that permits the property owner, e.g. landlord or owner-occupier, to challenge the assumptions in the EPC rating by using data and measurements.

  • Member Since January 2023 - Comments: 4

    11:42 AM, 3rd April 2025, About 1 year ago

    Get this comment now when click on link above, maybe it’ll change this week?:

    “This service is currently for homeowners
    However, privately rented homes can still be eligible for Warm Homes: Local Grant funding.

    Please contact your Local Authority directly if you are a tenant in a privately rented home and your landlord supports your application for Warm Homes: Local Grant.

    Please also contact your Local Authority directly if you are a private landlord and support an application for the Warm Homes: Local Grant for your rented property.”

  • Member Since January 2023 - Comments: 4

    11:43 AM, 3rd April 2025, About 1 year ago

    Will it apply to student lets with non UK resident tenants?

  • Member Since May 2018 - Comments: 1999

    12:00 PM, 3rd April 2025, About 1 year ago

    Reply to the comment left by Celine at 03/04/2025 – 11:42
    I clicked on the link. As usual I’m not eligible either as a landlord or as a homeowner.

    Looking at the tax position as an owner-occupier, if I were to spend money on making enough changes to my main home to significantly improve the EPC rating, and if this improvement to the EPC rating in turn increased the value of my house, then the effect would be:

    (1) The investments that I would have to make now would not result in me recovering the costs in saved energy bills between now and my likely passing.

    (2) The amount of investment that I would have to make to significantly improve the energy performance of my home would also reduce the amount of money that I can gift now to my children.

    (3) Particularly since Rachel Reeves included pensions in the scope of inheritance tax, the increase in value of my main home would result in my children facing a much larger inheritance tax bill at 40% tax to pay after my death.

    Looking at my buy-to-let investment my tenants would not qualify for grants: Because I am a non-incorporated small portfolio landlord and cannot offset my interest costs against rents I would be penalised for raising extra finance to invest in energy improvements and because to make a significant difference to the EPC rating I would have to make significant improvements it appears to me that these would be likely to be capital expenditure. Without the necessary capital allowances it appears that I would be unable to offset all the expenditure against rents.

    For those people who are housing low-income tenants I’m guessing that the property would only be eligible for the grant if the tenant remains in situ. A small proportion of landlords and tenants may benefit but it will make no significant difference to energy security or climate change.

  • Member Since August 2020 - Comments: 16

    12:06 PM, 3rd April 2025, About 1 year ago

    I donot see anything for London Borough of Hounslow in the List downloaded.
    Is there more than or list longer than BARNET post codes?

  • Member Since April 2023 - Comments: 174

    10:16 AM, 5th April 2025, About 1 year ago

    It seems you only need to meet one of the criteria. I have a flat with someone on a low income below 36000. I started to apply on gov site but it redirects landlords to your local authority. My local authority said the tenants income had to be below 30k but provided a link to apply. The link takes you to a company which says the income criteria is below 36K. I filled in the application form which was easy. When I get a response I will update.

  • Member Since March 2025 - Comments: 3

    4:01 PM, 5th April 2025, About 1 year ago

    Impact on Rent Increases: It’s important to note that accepting these grants comes with the condition that landlords agree not to increase rent. This measure aims to ensure that the financial benefits of energy efficiency improvements are passed on to tenants, helping to alleviate the impact of rising living costs. However, some landlords have expressed concerns about this stipulation, fearing it may affect their rental income.

  • Member Since April 2023 - Comments: 4

    7:45 PM, 5th April 2025, About 1 year ago

    Time to sell up and top up my pension.

  • Member Since May 2018 - Comments: 1999

    5:15 PM, 6th April 2025, About 1 year ago

    Reply to the comment left by Ian Sam at 05/04/2025 – 19:45
    I think you’ll find that Rachel is after your pension as well.

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