The Intermediary – September 2025 - Flipbook - Page 10
BUY-TO-LET
In focus
AT THE
CROSSROADS
LANDLORDS, LENDERS AND
THE FUTURE OF GREEN BUY-TO-LET
Natalie Thomas for The Intermediary
In its recent Minimum Energy Efficiency
properties that are already energy efficient, with
Standards (MEES) consultation, the Government
an EPC rating of Band A to C. Louisa Sedgwick,
outlined plans for all new rental tenancies to
managing director of mortgages at Paragon Bank,
meet an Energy Performance Certificate (EPC)
believes this approach is working well.
rating of Band C from 2028, with existing
tenancies following by 2030 – up from the
current E requirement.
incentivising landlords to purchase energy-
Estimates suggest that just above 1.8 million
efficient properties, we’ve seen a growing number
privately rented homes in England currently sit
of customers taking advantage of the preferential
below Band C. This presents a clear opportunity
rates available for homes with EPC ratings of A
for lenders and mortgage brokers to help
to C. Last year, these loans made up £795.3m
landlords finance the improvements needed.
of our total lending, accounting for 53.4% of
Yet, while some landlords are pushing ahead with
completions, up from 49.9% the previous year.”
upgrades, others are holding off for clarity on the
proposed MEES regulations – perhaps wary due
to previous Government U-turns.
For landlords looking to upgrade the energy
The second type of product is designed to
incentivise landlords to retrofit lower-performing
properties and lift them into Band C or above.
This is the approach taken by Fleet Mortgages.
efficiency of their rental properties, there are
Steve Cox, chief commercial officer at Fleet
mortgage products available to help. With an
Mortgages, says: “What has proved popular is the
estimated 350 green buy-to-let (BTL) deals
way we combine rate incentives with practical
available, the choice is there – but is the appetite?
financial support.
For those pressing ahead – whether driven
by regulation, the desire to cut energy bills, or
8
She says: “Since being one of the first lenders
to launch green BTL mortgages aimed at
“Our Green Cashback feature provides landlords
with a £1,000 cashback payment if they improve
broader sustainability goals, how well do the
the property’s EPC to a C or above during the
current products support them?
initial fixed-rate period.
The green carrot
occupation [HMO] and multi-unit freehold block
“Alongside this, our house in multiple
Not all buy-to-let lenders currently offer
[MUFB] products also include £1,000 cashback
dedicated green products, but those that do
at completion, helping to offset the significant
generally fall into two camps. The first rewards
upfront costs that typically come with these
landlords for purchasing or remortgaging
property types.”
The Intermediary | September 2025
