Two-thirds of houses in multiple occupation owned by landlords surveyed by Paragon Bank already hold an EPC rating of A to C its latest research suggests.
The 66% figure places the surveyed HMO portfolios ahead of England’s wider housing stock, where the latest English Housing Survey found that 56% of dwellings achieved one of the three highest energy-efficiency bands in 2024.
None of the landlords responding to Paragon’s research reported owning an HMO with an EPC rating of F or G.
More than a quarter – 28% – said they had brought planned energy-efficiency improvements forward in response to proposals to increase minimum standards in the private rented sector.
LANDLORDS PREPARE FOR 2030
The government intends to require privately rented homes in England and Wales to achieve the equivalent of EPC C by 2030, subject to the details of the reformed assessment regime and applicable exemptions.
Properties that cannot currently achieve the required standard could require insulation, heating, glazing or renewable-energy improvements over the coming years.
HMOs can present landlords with distinct energy challenges because they typically accommodate several unrelated households and may include utility bills within the rent.
Paragon found that more than four in 10 HMO landlords surveyed were absorbing increased energy costs rather than passing them on through higher rents.
Louisa Sedgwick (main picture), Managing Director of mortgages at Paragon Bank, says: “Energy efficiency is now a core part of how HMO landlords operate. Many are already ahead of proposed standards, which reflects a long-term approach to managing their properties.
“It is also encouraging to see the steps landlords are taking to support tenants with the cost of living.”
PORTFOLIO INVESTMENT
Sedgwick says improving energy efficiency could enhance portfolio values while helping to maintain the affordability and sustainability of shared housing.
“With a large proportion of HMOs already meeting expected requirements, landlords are well placed for future regulatory changes while continuing to deliver good-quality, cost-effective accommodation,” she adds.
The current minimum standard generally remains EPC E for domestic private rented properties, unless a valid exemption applies.
The government’s proposals for privately rented homes would raise that threshold by 2030, while the latest English Housing Survey shows the proportion of homes rated A to C has more than doubled over the past decade.
