Here, we look at what an EPC is and why it matters when it comes to buying a property.
An EPC rating measures the energy efficiency of a property from A (extremely efficient) to G (least efficient).
The higher the rating, the lower your energy bills are likely to be. A poor EPC rating suggests low energy efficiency, which means it will cost you more to heat and power the property.
EPCs also provide information on things like the property’s carbon dioxide emissions, which can give you an idea of its environmental impact.
The average EPC rating for a home in the UK is D. Properties that achieve a rating of A tend to be brand new environmentally-friendly homes that have a low carbon footprint.
EPCs provide 2 ratings: current and potential. This shows how efficient the property is now, and how much it could be improved with some recommendations listed on the EPC. It also includes the typical installation cost and typical yearly saving of each measure.
If you’re buying a home, the person selling the property must show you the EPC. If you’re renting, it’s the landlord’s responsibility to provide one.
You can also find out if a property has a valid EPC on the government register.
Some properties don’t require an EPC, such as certain listed buildings, but it’s worth checking to make sure.
According to the Climate Change Committee (CCC), 40% of UK emissions come from households.1
Landlords are also affected. At the moment, rental properties must have an EPC rating of E or above for legal reasons, but the EPC threshold may increase in the future.4
You may need to carry out additional insulation work or other improvements to make a home more energy efficient – before you’re able to let or, potentially, sell the property.
Due to the impact low energy-efficient homes have on the environment, lenders may need to factor EPC ratings into lending decisions. This is something to be aware of when considering certain properties to buy.
If the property you’re looking to buy has an EPC below what we might expect, and little room to improve it with recommended measures, you could find your application is rejected.
Remember – if a home’s EPC doesn’t meet a minimum of an E rating, then it’s illegal to rent it out. This will affect the prospects of getting a buy-to-let mortgage on that property.
If we reject your application, we’ll show you the reasons why. It’s important to remember – it’s only because of the EPC rating of the property, we could give you a mortgage on a different property.
1Climate Change Committee: How households can help reduce the UK’s carbon footprint
2Climate Change Committee: The Sixth Carbon Budget: The UK’s path to net zero
3Green alliance: How to scale up home energy efficiency in the UK
4GOV.UK: Minimum energy efficiency standard - landlord guidance