Propertymark, the leading body representing property agents in the UK, has urged the government to tailor upcoming energy efficiency regulations for rental homes to individual circumstances, warning that a blanket approach could drive landlords out of the market and harm tenants.

Unrealistic Government targets

In response to the Department for Energy Security and Net Zero’s (DESNZ) consultation on reforming the Energy Act 2011, Propertymark drew on feedback from 350 property professionals and roundtable discussions across England and Wales. While backing improved environmental standards, the organisation cautioned against unrealistic targets and disproportionate financial burdens on landlords – particularly in the diverse and often aging private rental sector.

“Propertymark wants to see more energy efficient homes, but the targets must be realistic and achievable,” said Timothy Douglas, Head of Policy and Campaigns at Propertymark. “We have long said that the UK government must do more to understand the finances of landlords and introduce measures that take into account the diverse nature of property types across England and Wales in the private rented sector.”

Cost cap proposals

A core concern is the government’s proposed increase to the landlord cost cap – from £3,500 to £15,000 per property – before a “high cost” exemption can be granted. The organisation warns the jump would force many landlords to leave the market, exacerbating the rental housing shortage.

Instead, Propertymark recommends a cap of £5,000, which it says would support “incremental adaptations” and better fit the budgets of small landlords. The organisation also emphasised the need for accessible financial aid to support energy upgrades.

The trade body further points out the secondary costs involved, such as temporary housing for tenants during upgrades and lost rental income if properties are vacant during renovations: Propertymark states “Tenants are likely going to have to temporarily move out of the property; it is not yet clear if the cost of temporary accommodation could be included in the cost cap, and if the property is void it would be an additional loss of income on the landlord to make improvements before the property is liveable again.”

Criticism of EPC assessments

Beyond cost concerns, experts are also sounding alarms over the technical foundations of the proposed energy rating reforms. Anna Moore, CEO of retrofit company Domna, warns that the proposed replacement of the Standard Assessment Procedure with a new Home Energy Model (HEM) could misclassify millions of homes and misdirect public funding.

“HEM doesn’t address the critical flaws,” Moore said. “This sounds technical, but it matters, because if the models are wrong, all the legislation built upon them will fail.”

She highlights a long-standing issue with energy assessments: “What most people don’t realise is that over two million homes rated ‘efficient’ on paper are actually nowhere near it.” Moore criticises current practices relying on brief, visual inspections that often result in errors as high as eight EPC points – enough to misclassify homes entirely.

She calls for better training, higher professional standards, and technological integration. “We need better training and higher professional standards to solve carelessness and corruption.” Moore adds that anonymised smart meter data and AI-based analysis could significantly improve energy assessments. “Access to smart-meter data, or at least the datasets behind EPCs, would boost accuracy even further.”

Flexible implementation and extended timeline

The government’s current plan would require all new tenancies to meet EPC ‘C’ standards by 2028, with all existing tenancies following by 2030. Propertymark has proposed simplifying the transition by setting a single compliance date of 2030 for all tenancies to reduce confusion and allow for planning.

It also supports a broader range of exemptions, particularly for heritage or recently improved homes, and cases where energy upgrades would paradoxically raise energy costs or where tenants object to intrusive works.

Propertymark stated “We support an extended 10-year exemption period and recommend further exemptions for listed buildings, properties with recent EPC improvements, and cases where proposed upgrades increase energy costs”.