EPC ratings are increasingly becoming a focus for UK expat and foreign national investors, with new plans in place to impose an EPC requirement on rental properties.
According to research from property portal, Rightmove, there are currently 2.9 million rental homes that need to be upgraded in order to meet the new government target of a C EPC rating by 2030.
Making a home greener can be complex and in many cases, it’s the cost that remains the biggest barrier for UK expat and foreign national investors thinking about making the changes, with the estimated cost of green renovations priced at over £8,000 per property.
Utilising equity to conduct green renovations is a great way to both satisfy the EPC requirements that the government looks certain to impose while also adding value and desirability to an investment property.
EPC ratings of a C or above will be required again for UK expat investors. Re-mortgage products can help to finance these green renovations.
The most popular solution for UK expat investors to conduct green renovations on their property is to utilise re-mortgage products to raise capital which can be used to improve EPC ratings.— Stuart Marshall
MANCHESTER, GREATER MANCHESTER, UNITED KINGDOM, December 23, 2024 /
EINPresswire.com/ -- EPC ratings are increasingly becoming a focus for UK expat and foreign national investors, with new plans in place to impose an EPC requirement on rental properties. But with cost as a limiting factor, how can UK expat and foreign national investors renovate their investment properties?
EPC Ratings of C or Above are Required.
There have clearly been plans to impose EPC requirements on landlords for a while, as the UK tries to find ways satisfy its environmental targets. Previous plans for a requirement that all rental properties have an EPC rating of a C or higher were scrapped, but the Labour government has confirmed that it will reintroduce this target,
which needs to be met by 2030. This is a huge change from the current minimum energy efficiency standards (MEES) which require all rental properties to have an EPC rating of an E or above.
According to research from property portal, Rightmove, there are currently 2.9 million rental homes that need to be upgraded in order to meet the new government target of a C EPC rating by 2030. But making a home greener can be complex and in many cases, it’s the cost that remains the biggest barrier for UK expat and foreign national investors thinking about making the changes, with the estimated cost of green renovations priced at over £8,000 per property.
UK Expat and Foreign National Investors Need Greener Properties.
‘The
discussion about EPC ratings and rental properties is unlikely to go away’ says Stuart Marshall, CEO of Liquid Expat Mortgages. ‘High energy bills look like they’re here to stay, with
Ofgem announcing a second price rise this winter. This means that bills are set to go up again in January, bringing them to more than 50% higher than pre-Covid levels. And consumers are feeling the squeeze from these higher prices too, leading many to search out more efficient rental properties.’
So, the need for UK expat and foreign national investors to improve the EPC rating of their rental property is twofold. First, they will be required to do so by legislative changes and second, their rental property will be far more attractive for renters if they are greener or more efficient. The benefits of greener homes for tenants are clear. The most obvious benefit is the lower energy bills offered by the more efficient property. But the reduction in carbon footprint can also be attractive as many tenants – especially younger ones – are increasingly eco-conscious and keen to reduce their impact on the climate crisis.
How Re-Mortgage Products Can Help.
‘The most popular solution for UK expat and foreign national investors to conduct green renovations on their property is to utilise re-mortgage products to raise capital which can be used to improve the EPC rating of a property. This is a great way to finance these renovations as the investor uses existing equity in the property rather than having to pay for these changes out of their own pockets. Utilising this equity to conduct green renovations is a great way to both satisfy the EPC requirements that the government looks certain to impose while also adding value and desirability to an investment property. By making these changes, UK expat and foreign national investors are likely to increase the rental yield of their investment as the property will be more desirable in the rental market.
Further, in raising capital for renovations in this way, UK expat and foreign national investors are also able to inadvertently take advantage of the quality UK expat and foreign national mortgage products that are available through expert brokers. At the moment, there are some specialist deals available for UK expat and foreign national investors who commit to making their property more energy efficient. Incentives can come in the form of cash, discounts, and preferential rates. These deals can translate into big savings and higher profits for those willing to undertake the process of conducting green renovations. In addition, there are a number of different schemes available at the moment which are intended to minimise the cost of green renovations. Using these schemes in conjunction with green mortgage deals and the advice of a specialist expat mortgage broker can be an incredibly lucrative way to meet environmental legislation.’
The other way that re-mortgage products are commonly used by UK expat and foreign national investors looking to satisfy EPC requirements is to use some of the equity in the property to purchase another, more efficient property. This can be an incredible way to get the most out of an asset, but it is probably best suited for more experienced investors or those who are very confident in their investment venture. Regardless, a specialist UK expat or foreign national mortgage broker will be able to help and discussing this possibility with them can help investors to decide if expanding their portfolio via a re-mortgage product is a good decision for them.
Other Ways to Meet the EPC Requirements.
‘Other solutions to the EPC requirements concern the types of properties that UK expat and foreign national investors buy. For example, many of our clients at Liquid Expat Mortgages have been seeking out smaller, more modern and efficient properties like city-centre flats. These flats are typically more efficient because they are newer and are built to more exacting energy standards than older homes. When compared to a conventional home, this equates to an approximate annual energy saving of £470 (an annual energy cost of £1,247, compared to £1,717 on a 2-3 bedroom house). And while properties like this are already more likely to satisfy the EPC requirements, they are also highly desirable for renters at the moment and this is contributing to high asking rents.’
‘For UK expat and foreign national investors who already own properties of this sort, this is great news. First-time investors who are looking to get a lucrative slice of the UK’s buy-to-let market should look to invest in more environmentally friendly properties like this to maximise the profits from their investment. For existing investors with older properties, selling these properties and buying something more energy efficient like a newer flat can be the easiest way to satisfy the EPC requirements. However, this route will come with tax implications, so it’s important to discuss this option with an expert UK expat or foreign national mortgage broker.’
Liquid Expat Mortgages
Suite 4b, Link 665 Business Centre,
Todd Hall Rd,
Haslingden, Rossendale
BB4 5HU
Phone: 0161 871 1216
www.liquidexpatmortgages.com
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Sergio Pani
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According to research from property portal, Rightmove, there are currently 2.9 million rental homes that need to be upgraded in order to meet the new government target of a C EPC rating by 2030.
Making a home greener can be complex and in many cases, it’s the cost that remains the biggest barrier for UK expat and foreign national investors thinking about making the changes, with the estimated cost of green renovations priced at over £8,000 per property.
Utilising equity to conduct green renovations is a great way to both satisfy the EPC requirements that the government looks certain to impose while also adding value and desirability to an investment property.