Landlords need financial help to implement ‘flawed’ EPCs

A push to boost the energy efficiency of British homes is at risk of collapse due to insufficient funding and systemic flaws in the Energy Performance Certificate (EPC) framework.

That’s the verdict of Mark Bailey, a partner at chartered surveyors and auctioneers Landwood Group who also wants cash help for landlords.

He said: “Without financial support, how many people struggling in the current economic climate can afford the investment in, for example, heat pumps and triple glazing?

“How do landlords investing in properties pay for the improvements without passing that cost on to tenants?”

He added: “The government must design more equitable financial mechanisms beyond paltry subsidies, with tailored incentives addressing different economic circumstances.”

EPCs to boost homes

Introduced in 2007 under an EU directive, EPCs aim to promote transparency and sustainable home improvements.

However, their effectiveness in the UK is undermined by the nation’s ageing housing stock, the oldest in Europe, with 38% of homes built before 1946.

These properties, often poorly insulated, require costly upgrades — estimated by the Building Research Establishment (BRE) to range from £8,000 to £15,000 to improve a property from a D to a B rating, yielding annual energy bill savings of just £500.

Compounding the issue, EPC assessments suffer from inconsistencies and errors.

EPC inaccuracies in home reports

Mr Bailey points to a 2024 investigation by Which? that revealed eight out of 12 homeowners reported major inaccuracies in their EPCs.

One reassessment correcting significant errors saw a property’s rating being boosted from D to B.

He says: “EPCs suffer from fundamental flaws undermining their effectiveness: poor data quality, highly subjective process, limited public awareness and inadequate legislative framework.

“These shortcomings have eroded public trust in the certification process.”

He added: “Administrative complexities and bureaucratic hurdles further complicate implementation, while the technical language creates a significant disconnect between specialist assessors and everyday users.”

Low-income EPC issues

The EPC cost impact is particularly severe for low-income households, who often live in less energy-efficient homes.

Mr Bailey says these families face disproportionate financial burdens, with little support to fund necessary upgrades.

Meanwhile, the market is shifting as properties with F and G ratings linger 25-30% longer on the market compared to A and B-rated homes, according to UCL Energy Institute research.

Also, half of UK lenders now offer ‘green’ mortgage rates for energy-efficient properties, further highlighting the growing divide.

EPCs haven’t delivered

Despite the EU’s goal to curb the construction sector’s 40% share of energy demand and 36% of carbon emissions, the UK’s EPC initiative has not delivered.

Mr Bailey said: “It’s fair to say that EPCs are also doing nothing to help low-income families who tend to live in less energy-efficient housing.

“Low-income households face a disproportionate financial burden from renovations.”

He added: “The BRE estimates that improving a property from an EPC rating of D to B typically costs between £8,000 and £15,000, to reduce annual energy bills by approximately £500.

“For those looking to sell, positive EPCs can make their home more saleable but are unlikely to improve the value.”