Warm Homes Fund: Landlords need targeted support
Funding alone will not be enough to help landlords hit ambitious EPC C targets – with a comprehensive package of support needed if the plans are to succeed.
We have issued the warning to Government in response to its £5bn Warm Homes Fund plans, which are currently out for consultation.
While we applaud the ambition of the scheme, we have stressed it is vital that Ministers consider the real-world challenges faced by landlords and the practical changes that can be made to help them.
In our response we have argued the fund should not only be source of finance, but a market enabler, helping to overcome wider barriers to retrofit. We have also included a list of key recommendations that we believe will make a difference, from initiatives to tackle the shortfall in qualified tradespeople to expert support in accessing green finance options.
So exactly is the Warm Homes Fund?
The Warm Homes Fund is a funding package worth £5bn, which has been drawn up to speed up energy efficiency upgrades and encourage private investment in retrofit projects, with a consultation launched in March.
According to the documents £3.3bn of this figure will be set aside for ‘innovative finance solutions’ to fund retrofit projects and building upgrades.
The Government wants the fund to stimulate private investment, boost the retrofit supply chain, and help owner-occupiers and landlords with the upfront costs of home improvements.
We have applauded the ambition – but emphasised the Government must consider the realities of the PRS if the scheme is to progress and succeed.
The challenge
As we are sure you know by now, landlords are expected to play a major role in improving the energy efficiency of the housing stock in England and Wales and have until 2030 to get their properties to an EPC C.
This looming deadline – just a few short years away – is increasing both the urgency and complexity of retrofit decisions.
In our response, we explained the upfront cost of improvements remains a significant challenge, landlords also face policy uncertainty, changing regulatory requirements, limited awareness of available support, and practical difficulties in delivering retrofit projects.
Existing mortgage restrictions and the often-limited financial returns associated with retrofit investments can further reduce the economic viability of improvements, particularly for smaller landlords.
Recommendations
We have recommended the fund:
- Encourages lenders to develop products created specifically for properties with lower EPC ratings, helping direct support to homes that require the most significant improvements.
- Enables finance models that combine private investment with grants and tax incentives, ensuring landlords can access support from multiple sources.
- Recognises the diversity of the PRS, including the different needs of small and large landlords and the unique challenges faced by leaseholder landlords in multi-occupancy buildings.
We stressed that without tailored approaches, there is a risk that support will fail to reach many of the properties that need upgrading.
We also called for brokers and finance professionals to receive ongoing training and guidance to help landlords navigate existing and future green finance opportunities.
Measuring Success
We believe that for the scheme to be considered a success there must be clear delivery frameworks and transparent measures in place, and the Government should be able to prove the investment has:
- Increased supply chain capacity.
- Improved in the energy performance of homes.
- Improved the availability of finance products for retrofit projects.
Transparent reporting on how public funding is being used and what impact it is delivering is also vital.
The Warm Homes Fund has the potential to play an important role in helping landlords improve the energy efficiency of their properties, however, its success will depend on whether it provides practical, accessible support giving landlords the confidence to invest in improvements at scale.
