Energy Efficiency and Buy to Let Property Selection

A new factor all current and new residential property investors need to take into consideration when considering a purchase is that of Insulation Values and Energy Efficiency.

Whether you are reviewing your existing portfolio, considering adding to it or starting to invest in the buy to let sector you need to look at the energy efficiency of every property. Many of the properties that give the best yields are older terraced houses often located in or close to city centre’s. These tend to have larger floor plans and have more cupboards than modern properties making them very practical for renters. If the property was built before the 1940’s it is highly likely to have a solid outer wall. Such older properties and in particular those with solid walls, unless they have been improved, are likely to have low or very poor insulation and low energy ratings.

I urge all investors experienced and new to the market to research how energy efficient the property is and if it has a poor rating what can be done to improve it before committing to a purchase. Communities and Local Government already have plans in place to restrict the letting and sale of properties in the lowest energy performing groups.

I think it is fair to expect these requirements to tighten rather than weaken in the future as they have in other industries where energy labeling has been used. UK MP Chris Huhne has stated this explicitly as follows; “From 2016, any tenant or their representatives asking for their landlord’s consent to make reasonable energy efficiency improvements cannot be refused. From 2018, the rental of the very worst performing properties-those rated F and G-will be banned through a minimum energy efficiency standard.” The date he speaks of, ie 2018, is well within the normal time which buy to let landlords will continue to own properties purchased today.

In the future we can also expect renters to look carefully at the insulation values and energy efficiency performance of properties just as many are now selecting properties based on the potential broadband speed that can be achieved.

I strongly advise you to get advice from a professional letting agent regarding the selection, marketing and management of your investments. They will be able to give good local advice, especially in the area of energy efficiency and how to negotiate with sellers to ensure the minimum requirement for 2018 ie band E or better is achieved.

This article was prepared and written by Terry Lucking owner of Belvoir Lettings Agency Cambridge. Terry offers free advice and free property visits to all investors who are considering buying.

Terry Lucking is Managing Director of Belvoir Property Lettings the leading residential lettings agents in Cambridge. In addition to lettings he offers comprehensive Buy To Let Landlords Services. He can be contacted on +44 (0) 1733 574060, email