There is a real danger those PRS properties which cannot meet the government’s required EPC level by 2025 will make many of them “unmortgageable and unprintable”.

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The Ministry of Levelling Up, Housing and Communities is claiming there are over 13 million homes in England and Wales currently with an EPC rating of D or lower.

With the oncoming new minimum ‘mandatory’ EPC C rating fast approaching in 2025, many rental properties with an EPC D rating or below will be stopped from taking on new tenants.

The ominous warning comes from a retail and commercial lender and the property finance managing director John Eastgate, says: “For many property owners in the UK, getting their property to a C rating is going to take a lot more than simply installing a new boiler. The reality is that for older properties - some of which may be listed- it will be an expensive exercise to make the necessary changes.

“… It’s completely right that we should all be considering how to make our properties more energy efficient and environmentally friendly. Some owners, however, will need support from both lenders, and the government, to make these changes financially possible.

“Without this, we risk a substantial part of the private rental sector becoming unrentable and therefore unmortgageable and unsellable in 2025. With home ownership still out of reach for many this could leave us with a shortage of quality homes to rent.”

However information from the new survey takes into consideration that many landlords are already taking steps to improve their properties’ energy efficiency to meet the new regulations coming into force in 2025.

The lender’s research has found that 17 per cent of landlords have already made changes to properties to meet the new regulations as well as 22 per cent of portfolio landlords having done so.

Typical changes/refurbishment made by landlords are replacing windows - 23 per cent, installing a new boiler and heating system – 22 per cent  with 18 per cent buying new white goods.

The lender claims energy efficiency ratings increases tenant demand as 10 per cent of tenants, that took part in the survey, claimed they would stay put in their present home if the landlord improved the property to help the environmental cause.

The lender ‘suggests’ that renters would happily pay a higher rent if the landlords did improve energy efficiency.

Around 18 per cent would be happy to pay more rent if their landlord replaced the windows, 15 per cent had no problem with increased rent if the landlord installed a new boiler and heating system, and 10 per cent apparently saying that if solar panels were installed then this would warrant an increase in their rent.

But some landlords who own older properties which can by their nature be virtually impossible to improve  their rating that by 2025 some will become ‘unrentable’ and ‘unsellable’.

Richard Merrick of PIMS, says:” The percentage of tenants saying they are willing to pay more rent because of EPC improvements made to their property, is somewhat contentious as these changes will have to be made anyway.