Energy efficiency plans unviable for most landlords, NRLA finds

Government energy efficiency plans for rental housing are not financially viable for most landlords, research by the National Residential Landlords Association (NRLA) found.

Landlords could be required to spend up to £15,000 per property to meet new standards. 

The research showed the average threshold for affordability is £7,700. 

Over this amount, most landlords would not be able to cover the cost.

The Budget recently cut funding for energy efficiency schemes by a quarter for this parliamentary term, according to think tank E3G.

The NRLA said the Government should not assume landlords are wealthy enough to pay for these upgrades. 

HM Revenue and Customs (HMRC) data showed average rental income for unincorporated landlords is £19,400 a year, which is lower than a full-time minimum wage salary.

There was no specific support for the rental market in the Budget, despite calls from the Committee on Fuel Poverty for new tax measures to help with investment.

The NRLA is calling for all energy efficiency works to be fully deductible against income tax. 

The association also recommended setting the cap landlords will be expected to invest according to the value of the property, to avoid putting a higher burden on lower-value properties, especially in the North.

Ben Beadle, CEO of the NRLA, said: “We want all rental properties to be as energy efficient as possible. 

“However, this isn’t going to happen without a serious plan to support the investments needed.

“Relying on the misguided belief that every landlord has limitless reserves to fall back on is not only wrong but will not get tenants any closer to seeing their homes made energy efficient.”

Beadle added: “If the Government is serious about its plans, it needs to engage with the sector now to develop a clear, bespoke package to help responsible landlords invest in energy efficiency works. 

“That needs to start by fixing a broken tax system which does nothing to encourage proactive property improvements.”

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