NRLA Warns Landlords Cannot Afford EPC Upgrade Costs

The National Residential Landlords Association (NRLA) has raised concerns that the proposed energy performance certificate (EPC) upgrades for rental properties are financially unviable for many landlords. With government plans requiring substantial investment to meet minimum EPC standards, the NRLA warns that without adequate support, landlords will struggle to fund these improvements, potentially impacting the rental market and tenants alike.

Government EPC Upgrade Requirements and Financial Impact

The UK government has set ambitious targets for rental properties to achieve a minimum EPC rating of C. By 2028, this standard must be met for all new tenancies, and by 2030, for all existing tenancies. To comply, landlords may need to invest up to £15,000 per property in energy efficiency improvements.

However, research conducted by the NRLA indicates that once expenditure on energy upgrades exceeds £7,700, the average landlord’s ability to make a profit is severely compromised. This financial threshold highlights the challenge faced by many landlords, particularly those with modest rental incomes.

Challenges in Funding EPC Improvements

Ben Beadle, Chief Executive of the NRLA, emphasises the need for a realistic and supportive approach to funding these upgrades. He states, “We want all rental properties to be as energy efficient as possible. However, this isn’t going to happen without a serious plan to support the investments needed.”

Beadle criticises the assumption that landlords have unlimited financial reserves, describing it as “misguided” and unhelpful in achieving energy efficiency goals. He calls on the government to engage with the private rented sector (PRS) to develop tailored support packages that encourage responsible landlords to invest in necessary improvements.

Tax System and Funding Cuts

The NRLA also highlights the need to reform the current tax system, which it describes as “broken” and lacking incentives for proactive property improvements. The organisation advocates for energy efficiency spending to be fully deductible against income tax, which would ease the financial burden on landlords undertaking EPC upgrades.

These concerns come in the wake of the Autumn Budget, which reduced overall energy efficiency funding by 25% for the current parliamentary term, a cut noted by the think tank E3G. The NRLA warns that such reductions, combined with unrealistic expectations of landlords’ financial capacity, risk undermining the government’s energy efficiency ambitions.

Landlord Income and Regional Considerations

Data from HM Revenue & Customs (HMRC) reveals that unincorporated landlords report an average annual rental income of £19,400, significantly below the full-time minimum wage. This statistic challenges the perception that landlords are uniformly wealthy and able to absorb high upgrade costs.

The NRLA also stresses that a single national investment cap on EPC upgrades would disproportionately affect landlords in lower-value property markets, particularly in northern regions. This could exacerbate regional disparities and create further challenges for landlords outside more affluent southern areas.

Calls for Government Action and Sector Engagement

Despite recommendations from the Committee on Fuel Poverty urging tax measures to support investment in energy efficiency, the recent Budget did not include specific provisions for the PRS. The NRLA urges the government to provide clarity on final proposals and to develop bespoke financial support mechanisms for landlords.

With landlords awaiting detailed guidance, the NRLA’s position is clear: without targeted support and tax reforms, the sector will struggle to meet EPC requirements, potentially putting rental supply and tenant welfare at risk.

Looking Ahead: Support for Landlords

In related developments, The Landlord Association (TLA) is preparing to launch a new Trusted Partners Hub in the first quarter of 2026. This initiative will feature verified and approved service providers across legal, trades, insurance, financial, mortgage, tenant screening, and other sectors to support landlords, tenants, and property management businesses. Service providers interested in joining can register their interest via the TLA website.