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Even though the private rental sector is already a step ahead of the owner-occupier one, thanks to minimum EPC standards, the green, green grass of a rental home just took on an even more verdant hue.
The Chancellor announced a new Green Homes Grant as part of his summer statement on 8th July 2020 and this new initiative actually includes landlords. As a letting agent, you might be wondering just how many of your clients will take up the offer as it is a voluntary scheme, after all.
It is worth remembering, however, that the decision to make a rental property more energy efficient doesn’t entirely rest with the landlord. Tenants have been able to request consent from their landlord to carry out their own energy efficient improvements to privately rented properties since the 1st April 2016. It’s a little known fact that landlords can not unreasonably refuse consent although up until now, a tenant requesting such changes has had to fund the work themselves.
Now there really is no excuse for any rental property to have slack sustainability credentials, especially as the new grant fills the gap left when the Green Deal loans were scrapped in 2015.
While no application date has been confirmed, landlords will soon be able to apply for a grant – not a loan – to the value of £5,000 per household. The structure of the deal will see the Government cover 75% of the cost of energy saving home improvements, with the landlord paying the remaining 25% out of their own pocket. It is thought permitted improvements may include new boilers, upgraded insulation, solar panels and double or triple glazing, although we await a definitive list.
A cautionary note has been sounded, however, as the Green Homes Grant scheme has a cap of £2 billion. While this sounds like a generous pot of money, it may only stretch to improving energy standards in 650,000 homes – which equates to about 2% of the residential property market. It is also unclear whether a tenant will also be able to access the Green Homes Grant or if they would need to ask their landlord to participate – referring back to a tenant’s right to request consent from a landlord to undertake energy efficient improvements themselves.
Property managers acting on behalf of letting agents should prepare for an increase in property access and maintenance requests in light of the Green Homes Grant’s introduction – all which is currently set against a backdrop of continuing Covid restrictions and the potential for local lockdowns. If you need any clarification, please don’t hesitate to ask ARPM.
The Green Homes Grant is part of the Government’s wider ‘green recovery’, which neatly forms part of its pledge to cut greenhouse gas emissions to net zero by 2050. It is also hoped that the uptake of the grants will save and create jobs in the skilled trade and sustainable energy sectors.Back to knowledge hub