Landlords: how to entice tenants with a £400 a year saving


Everyone knows new-builds are generally much more energy-efficient than older properties, and landlords can use the latest surprising figures as a crucial selling point. 

Energy efficiency, environmental impacts and emissions are all high on the agenda of governments and individuals alike across the world right now. Residential property is one of the biggest culprits in adding to our carbon footprint, and it is a reason why new-builds are becoming even more appealing.

However, it is certainly not just homeowners who are looking at the benefits of new-builds. Landlords are increasingly keen to invest in better quality new-builds as opposed to old properties that need constant renovation and upkeep. Furthermore, landlords can make their rental homes even more appealing by revealing how much money can be saved in energy bills by the tenants who live there.

Breaking down the numbers

Some new research from Warwick Estates has discovered that new-builds can reduce energy bills by as much as 60% in some areas when compared to existing properties. For some, this could mean savings of more than £400 a year, which would be a massive incentive for landlords to offer to anyone looking to rent their property.

In England as a whole, the average energy bill per household is £797 per year when looking at just existing properties. This of course would vary massively when looking at different property types. However, compare this to a new-build, whose annual energy bill average £390, and that’s a saving of a huge £407 per year, or 51.1%.

The figures were then broken down by looking at the varying energy costs in different areas. When looking very specifically, Harrow and Redbrige in London saw the biggest potential savings of around 60.1% in annual bills – the highest in the country.

On a regional basis, the West Midlands is the area with the biggest possible savings. There, landlords can offer tenants an average of £439 per year off their annual energy bills if they own a new-build.

Landlords can help lower carbon footprints

While reducing bills is of course a massive benefit to investing in a new-build, the environmental factor is also a significant plus point. It is more important than ever for landlords to realise that growing numbers of tenants will factor this in when looking for a rental home.

Bethan Griffiths, chief operating officer of Warwick Estates, comments: “The energy efficiency difference between new-build homes and older, existing properties is stark. Improved insulation technologies, better windows, smart meters, and more, all contribute to a notable saving every year.”

“Not only does this increased efficiency save the homeowner and occupier large sums of cash, but it also significantly reduces the home’s carbon footprint. So there is a far wider benefit than our bank accounts alone.”

Energy efficiency in the private rented sector

As part of a crackdown on poorly kept rental homes and in a drive to tackle some of the country’s environmental issues, last year the government introduced a minimum EPC that must be reached on all privately rented properties. At present, all homes must achieve at least a band ‘E’ rating.

However, from 2025, the government wants to raise this target to a rating of ‘C’. At present, only around 2% of homes – both owned and rented – achieve an A or B rating, and 85% score in the C or D category. This means there is a lot to be done to meet the proposed standard in the next four years.

According to commentary from David Smith, real estate partner at JMW Solicitors, only new-builds or heavily upgraded properties are likely to reach band C by the 2025 target date.

“This will be a big change,” he says. “Moving to band E only affected around 200,000 of the least efficient properties based on government figures. Moving to a band C will affect well over two million properties, approaching half the buy-to-let sector depending on whose figures you prefer.

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Landlords: how to entice tenants with a £400 a year saving


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