RdSAP 10 Explained: The EPC update every Landlord should know about

We finally have a bit of clarity. Landlords have been bombarded with warnings about looming EPC changes for the last few years or so. Just to reiterate once more: the government plans to require all private landlords to upgrade their rental properties to a minimum EPC rating of C by 2030. For new tenancies, there is an earlier 2028 deadline.

The premise is simple enough to understand. What’s proven tricky, is the method. Many believe that our current EPC system isn’t fit for purpose. A recent study revealed that homes with high EPC ratings have been proven to be little different from poorly insulated properties. It showed that actual carbon emissions from properties in EPC bands A-C, were not significantly lower than for properties in EPC bands D-G.

Indeed, there appears to be widespread scepticism across the BTL market. Analysis from Leaders Romans Group (LRG) revealed that while landlords tend to agree with the principle of improving energy efficiency more broadly, nearly seven in 10 of them believe EPC requirements should reflect the level of control they hold over a property.

For example, they could specifically be tailored towards leasehold flats or converted properties, as opposed to being applied uniformly. Furthermore, only 16% of landlords say they are very confident in the ratings, with even fewer placing trust in the recommendations provided.

Fortunately, clarity on how to proceed may be coming to the forefront. New assessment methods and guidance could rectify these issues or at the very least, provide landlords with better direction on what should be prioritised.

The process of calculating EPC ratings for existing dwellings has been updated, a fact that may be under the radar for many landlords. The Reduced Data Standard Assessment Procedures (RdSAP) has been tweaked and now if a landlord commissions an EPC for one or more of their properties, they will be assessed against the new procedure.

Version 10 of RdSAP is a simplified version of SAP 11 for existing properties, with SAP 11 set to be the “full” assessment methodology used for new builds. The headline with this update is that RdSAP 10 now recognises newer technologies such as heat pumps, includes improved modelling of insulation and heating systems, and uses more up-to-date carbon factors.

This new methodology has only just been rolled out, and so we’ll likely need a few months to assess its efficiency. But this attempt at improving how we assess energy efficiencies should be welcomed. In fact, looking at the rental market, this news could lead to opportunity for landlords, brokers, and specialist lenders.

Many landlords have already taken steps to improve their properties, but there are still plenty out there who appear woefully underprepared. A recent poll of landlords revealed 62% are unaware that having an EPC is a legal requirement. Worryingly, only a third knew a C rating will be required by 2030.

Fortunately, it’s not too late to rectify this. Now that we have a better idea of what kind of upgrades should be prioritised, landlords can progress with more confidence, and our tailored finance solutions are primed to help.

At Market Financial Solutions, our BTL mortgages can be put towards refurbishment efforts as well as a purchase, meaning expanding landlords can get to work on their upgrades without the need for a separate facility. Moreover, our refurbishment products can allow landlords to install double glazing, heat pumps, and/or state-of-the art radiators while they’re in between securing tenants, as well as when they’re purchasing.

There is still work to be done in the rental market. With increased clarity finally arriving, we’re ready to support landlords who are ready to roll up their sleeves.

 

For adviser use only. Please note this content has been supplied by our lender partner and as such, is their responsibility. No party shall have any right of action against Legal & General in relation to the accuracy or completeness of the information in this article.