The Intermediary – September 2025 - Flipbook - Page 14
BUY-TO-LET
In focus
changes impacting the private rental sector. We
offer a Green Mortgage product with a reduced
borrowing rate for properties with an A or B
TECH AND THE
GREEN EVOLUTION
EPC rating."
Davey says the bank is further challenging itself
to see how it might expand the scope of this in a
“very price competitive marketplace.”
MELANIE SPENCER IS
The clock is ticking
GROWTH DIRECTOR
For the cohort of landlords who are waiting for
AT TARGET GROUP
the regulations to be finalised, the timeline may
be tighter than it appears.
“While the formal EPC deadline for achieving C
is still some years away, in the context of taking
out a 5-year mortgage now, it is already pressing,”
As regulatory pressures mount –
particularly around Energy Performance Certificate ratings
and landlord responsibilities – technology is becoming an
essential ally for brokers and lenders.
With proposals to raise the minimum EPC rating to B
and C by 2028, landlords face significant compliance costs
and operational challenges.
Digital platforms now offer real-time EPC tracking,
automated alerts, and AI-driven upgrade assessments,
enabling brokers to proactively guide clients through
regulatory changes.
Green mortgage products and sustainability-linked loans
are also gaining traction, supported by tech that matches
clients to suitable financing options based on property data.
Moreover, compliance dashboards and smart underwriting
tools help lenders mitigate risk while enhancing client
engagement. In this evolving landscape, tech isn’t just
a support tool – it’s a strategic asset for intermediaries
navigating the future of property finance.
explains Cox.
“A landlord who takes out a 5-year fixed
rate today may find themselves beyond the
compliance horizon when that deal ends, which
means they need to be planning now.”
He believes that the market will start to see a
lot more activity in terms of trying to incentivise
landlords to upgrade their properties.
Marie Grundy, managing director, mortgages
at West One, shares this view. Grundy says while
it is seeing demand for its own green products
for higher rated properties, there is scope for the
market to introduce more innovative products,
and to offer greater incentives to landlords with
lower EPC ratings.
“To support intermediaries and landlords,
lenders will need to think about developing a
broader range of green mortgage solutions to
meet the changing needs of landlords,” she adds.
In the meantime, she recommends brokers
start the conversation with their clients now, if
they have not already, adding: “It is important
that brokers alert their clients, who may be
and whether they are likely to provide a decent
unaware of the impact of the upcoming
return on investment.”
regulations, about the need to improve their EPC
He goes on to explain: “Where grants have
been available – for instance to install EV
"The main benefits are compliance and cost-
chargers – or where a tax efficient case can be
savings down the road when these standards
made for works, there is a distinct business case.
become mandatory.”
But entirely self-funded improvements are not
For all the best efforts of the lenders in the
guaranteed to yield sufficient increased demand
market, the green BTL mortgage market still
to cover their cost in the short-term.”
remains at a crossroads. While regulatory
Nigel Davey, head of BTL at NatWest Group,
uncertainty continues to create reluctance
also believes that tenants are increasingly aware
among some landlords, even when the
that energy efficient homes reduce the cost of
regulations are finalised, the challenge will lie
their utilities.
“We observe our landlord borrowers remain
12
rating today.
in developing products that can genuinely drive
energy efficiency improvements, rather than
attentive and responsive to tenant preferences,”
simply rewarding existing high-performing
he says.
properties.
“In this context, NatWest is keen to support
Green mortgages can only do so much, and
landlords who are looking to rebalance their
without deep pockets, the same might be said
portfolios or enter the market ahead of the EPC
for landlords.
The Intermediary | September 2025
