‘Thousands of landlords selling up’ in face of EPC challenge

Cornerstone Tax says only one-in-five landlords believes their property investment has been profitable.

Thousands of buy-to-let landlords are selling their properties ahead of the government changes to EPC regulations, new data shows.

Property tax specialist firm Cornerstone Tax found that just one-in-five landlords now say their investment has been a profitable one, with the same number admitting that they have lost thousands.

Around 65,000 rental properties went up for sale in the first three months of 2023, 36,460 of those holding an EPC rating of D or less, Cornerstone says.

By 2028, it is proposed that landlords must ensure that their properties hold a minimum EPC standard rating of C or higher, or face fines of up to £30,000.

david hannah stamp duty
David Hannah, Group Chairman, Cornerstone Tax

David Hannah, Group Chairman at Cornerstone Tax, says that expensive upgrades will make it difficult for landlords to maintain a viable letting portfolio, especially if they must spend money on a property that isn’t worth much more than the cost of the work.

“Under the changes to the EPC ratings for buy-to-let properties, only 0.2% of UK landlords would qualify for government funding.

Getting all rental properties to a standard EPC rating of C will be far too costly for landlords.”

There must be more government help, Hannah says. “Overall, I believe getting all rental properties to a standard EPC rating of C will be far too costly for landlords.

“I advise landlords to work out how much it will cost them to make these changes, and offset the time it will take for their investment to pay off.”

‘Six out of 10 landlords to sell due to EPC upgrade’

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