Government warned over demand for landlords to retrofit homes  

Government plans to improve the energy efficiency of private rented housing are “unachievable” due to a shortage of skilled workers, the National Residential Landlords Association (NRLA) has warned. 

Under current proposals by the Department for Energy Security and Net Zero (DESNZ), which are aimed at keeping homes warm and energy bills low, landlords have until 2030 to refit homes to an Energy Performance Certificate (EPC) rating of ‘C’. 

The current minimum standard is EPC ‘E’, with just 48 per cent of privately rented homes at EPC ‘C’ or above, according to government stats.

NRLA chief executive, Ben Beadle, said the consultation gives tenants unrealistic expectations for the timelines by which they can expect improvements to their homes. 

For Beadle, the main obstacle is a “chronic shortage of tradespeople the sector needs to get the work done.”

The accounting firm RSM has estimated the current shortage of tradespeople at 250,000, and the UK Trade Skills index has said this figure will rise to 937,000 by 2032.

“An ageing workforce, the cost-of-living crisis and the lingering effects of Brexit are having an impact on the uptake of new workers to the industry,” Adrian Attwood, Executive Director at DBR told CityAM earlier this year.

A DESNZ spokesperson told CityAM that they are working on tackling the skills shortage, having announced plans to “train up to 18,000 skilled workers to install heat pumps, fit solar panels, install insulation and work on heat networks.”

But while the government has pledged £2.5bn in additional funding to address the skills gap in construction, in addition to removing red tape to accelerate apprenticeship training, critics have said the approach fails to invest in the upskilling of the current workforce needed to create entry-level jobs and improve productivity. 

Rushed refits may lead to another rent spike

There have also been warnings that asking landlords to refit homes too quickly will lead to higher rents and bills, or even abandoned homes. 

The government has estimated that retrofitting homes to EPC ‘C’ or above will cost landlords £6,000, but a recent JLL report put the cost at £35,000 – nearly six times the government’s estimate. 

JLL said that the worst case scenario was homes “left empty to be demolished rather than upgraded, because of the significant cost versus the resulting value of the property”. 

Labour MP Jon Trickett warned that another negative effect could be for landlords to use the new requirements “as an excuse to bump up rents further”, meaning they will see no benefit from lower energy bills. 

This is at a time when rents across the UK are on the rise, and the prospect of home-ownership seems increasingly bleak for the majority of renters. 

Energy Minister Miatta Fahnbulleh acknowledged that retrofitting costs could be offloaded onto renters, but said in similar cases of home upgrade requirements, DESNZ “have found that landlords have not increased bills, so we do not expect them to do so this time.”

The DESNZ spokesperson said: “these plans could lift up to half a million households out of fuel poverty by 2030, while also making renters hundreds of pounds better off.”

‘Few landlords will make improvements if they don’t have to’

Supporters of the timeframe have pointed to the necessity of upgrading homes to help lift Brits out of fuel poverty and to ease the threat of damp and mold. 

“It’s right the Government is intervening to lift renters out of fuel poverty and reduce carbon emissions. The can has already been kicked down the road, which has been bad for renters and the environment,” Dan Wilson Craw, deputy chief executive at Generation Rent said. 

“Over half of private rented homes in England fall below EPC C, and few landlords will make improvements if they don’t have to,” he added.

Fears that upgrading homes will be too expensive for landlords may be premature, too – there are a number of schemes through which the government is funding upgrades. 

The Warm Homes Plan, for example, will see thousands of families receive £7,500 in order to install a heat pump. 

The Energy Company Obligation, too, will fund retrofit measures for low-income and vulnerable households, while the Boiler Upgrade Schemes offers grants of £7,500 towards the cost of replacing fossil fuel heating systems with low-carbon alternatives. 

“Everyone needs a good quality, affordable home. It’s the foundation of our lives,” Wilson said.