More than half of all rental homes in the UK fail to meet new energy efficiency standards due to come into force in just three years, revealing the huge bill facing landlords.
New data shows that 56% of properties in the country lack sufficient insulation to qualify for a so-called EPC rating of C or better.
Buildings are assessed for their energy efficiency, resulting in an A to G rating for the EPC system. A+ is the best rating a home can receive, proving it is able to retain heat better than other buildings.
At the end of 2025, new government rules mean that any home rented under a new lease must be rated C or better. By 2028, all rents must be up to that level.
Data compiled for LandTech, a property data platform, showed that 57% of social rental homes have an EPC rating of C or better, meaning they meet the standard.
But it still means that more than four out of 10 homes rented by municipalities will need to improve their insulation, leaving municipalities strapped for cash facing huge construction bills.
But private landlords face an even higher bill, as data showed nearly two-thirds (64%) of private rentals are not up to standard.
“Despite nearly half of all social housing falling below proposed compliance levels, we are hugely encouraged that social housing (both local councils and housing associations) has a 21 percentage point lead over private rentals in terms of the highest EPC percentage of C and above,” said Jonny Britton, co-founder of LandTech.
“The concern for the future is that cash-strapped local authorities still have a long way to go to meet minimum standards, with costs that could run into the millions to improve social rented housing stock.
“New construction, however, is the clear winner as developers have taken active control of the issue, and many are in fact shifting the debate about how to keep new properties cool during our extended summers due to climate change.”
He added: ‘Although a cost burden for landlords, our hope is that the rush to insulate and improve properties below C rating will lead to a mini boom for the specialist trades in these areas and lower utility bills. energy for tenants.
“The biggest winner is obviously the environment, so it’s in everyone’s best interest to support the cause immediately.”