What many renters love about UK housing stock – period properties, quirky character and original features – are the very same things that landlords are growing to hate. Maintaining older homes is proving so costly that it’s putting some property investors out of business.
The UK has one of the oldest housing stocks in Europe, with an estimated 38% built before 1946. Many properties were actually built in another century, with data from the Valuation Office Agency revealing 1 in 6 homes in England and a fifth of homes in Wales were built before 1900.
Many tenants reside in pre- or inter-war stock – way before modern methods of construction, building regulations and minimum energy standards. In fact, around 2 million homes built before 1944 are now in the private rental sector.
To be legally fit for the private rental market, even the oldest buy-to-lets have to meet ultra-modern standards. Currently, landlords have to ensure their portfolios meet the following compulsory regulations:
The Renters’ Rights Bill – which is currently in the House of Lords and should be passed into law this autumn – will also see the introduction of a Decent Homes Standard for the private rental sector.
Although this lacks granular detail at present, there is already a Decent Homes Standard in the social housing sector and we can look to this for guidance. At present, the standard ensures properties are “in a reasonable state of repair, have reasonably modern facilities, and provide a reasonable degree of thermal comfort.”
Speculation is rife as to what ‘decent’ will mean for private landlords but if we take the social housing standard as a guide, bathrooms must be under 30 years old and kitchens must be less than 20 years old with adequate space and layout. Additionally, adequate noise insulation and sufficient common entrance areas will be required.
As well as the Decent Homes Standard, the Government intends to increase the mandatory EPC required on private rental properties. Currently a buy-to-let needs an EPC rating of least an E to be legal. The proposal is for all new tenancies to require an EPC of at least a C, with this extending to existing rental properties in 2030.
Figures published by Inside Housing indicate 2.5 million homes in the private rental sector have an EPC rating of D to G. As a result, more than 50% of buy-to-lets will need some form of energy efficiency retrofitting to stay legal. The cost to comply? Achieving the new C rating will cost landlords an estimated £6,100 and £6,800 per rental property.
As professional property buyers, Open Property Group has purchased 100s of pre-1944 houses and flats. Typically they need the same, costly work to bring them up to modern standards. Here are some of the most common maintenance work required, together with average costs provided by Checkatrade:-
The Checkatrade figures should be used as a guide. Each projects price will be affected by where in the UK the job is, labour costs, the price of materials and how quickly the install needs to happen.
All landlords will have a degree of upkeep costs – even those with the most modern and energy efficient homes. From redecoration (£2,500 for a basic finish in a flat) to replacing the carpet in one room (£1,200), keeping a rental habitable is a costly exercise.
If maintenance costs now – and in the future – are making you question the viability of your buy-to-let, contact Open Property Group. We will make you a cash offer on your property, whatever its condition inside and out.
Our service is quick and reliable, cutting out estate agents and their fees. You can even sell with sitting tenants – no need to serve notice or wait for a tenancy to end. Contact us and we can explain how we buy properties like yours.
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