The EPC overhaul: what every landlord needs to know

If you own a rental property in England or Wales, you have probably heard that EPC rules are changing. What you might not know is just how significant the change will be, or that the clock for planning is already ticking. Here is everything you need to know.

Why EPCs are changing

The current energy performance certificate has served its purpose, but the government believes it is no longer fit for a net-zero world. The existing A-to-G rating uses a single score calculated under the Standard Assessment Procedure (SAP), which was designed decades ago and does not always reflect how efficiently a home actually heats itself or how ready it is for low-carbon technology.

A new system is on the way, using a completely different calculation method called the Home Energy Model (HEM). This replaces SAP entirely and introduces four separate performance metrics instead of one. The government originally planned to launch the new system in October 2026, but confirmed in March 2026 that it is delayed to the second half of 2027, with the exact date to be announced by summer 2026.

The four new metrics

Under the reformed system, every rental property will receive four ratings, not one:

• Fabric performance: How well the building itself retains heat, including walls, roof, floors and windows. This is the foundation of the new system and the one landlords cannot avoid.
• Heating system performance: The efficiency and carbon impact of the property's heating and hot water setup. Crucially, gas boilers are capped at Band D in this metric, meaning they cannot achieve the required Band C regardless of the boiler's age or efficiency.
• Smart readiness: The property's capacity to support smart energy technology, such as solar panels, battery storage or smart controls that interact with the grid.
• Energy cost: An estimate of annual energy bills for the property, included for information only. There is no separate compliance threshold for this metric.

What you need to achieve by 2030

From 1st October 2030, all privately rented properties in England and Wales must meet minimum standards under the new system. The requirements are:

1. Band C in fabric performance (mandatory for all)
2. Band C in either heating system performance OR smart readiness (your choice)

So while you cannot achieve Band C on the heating metric with a gas boiler, you can still comply by instead achieving Band C on the smart readiness metric, for example by installing solar panels or battery storage.

The key dates

There are three dates every landlord should have on their radar:

1. Late 2027: The new HEM-based EPC system goes live. Legacy assessments still use the current SAP method until this point.
2. 1st October 2029: Legacy EPC ratings expire. If your property currently holds a valid Band C certificate, it remains valid for compliance until it expires. After this date, all certificates must use the new format.
3. 1st October 2030: The final compliance deadline. All privately rented properties must meet the new four-metric standards from this date.

52% of rental properties currently fall short

Around 52% of privately rented properties in England and Wales currently sit below EPC C under the existing system. With the new framework being more demanding, particularly around heating systems and fabric insulation, the proportion needing improvement work could be just as high.

Properties with solid wall construction, older glazing or gas-fired central heating face the most work. But the framework is designed to be flexible. The smart readiness route gives landlords an alternative path if replacing the heating system is not practical or affordable.

The cost cap and financial support

The government has set a spending cap of £10,000 per property over a rolling ten-year period. For lower-value properties the cap reduces proportionally: a property worth £80,000 would have a cap of £8,000.

Where the cost of bringing a property up to standard would exceed the cap, landlords can register an exemption. Exemptions are also available where improvement works are technically unfeasible, for instance in certain listed buildings or properties with unusual construction.

The £5 billion Warm Homes Fund provides a mix of government-backed loans and targeted grants. The intention is that landlords with lower-value properties or tighter margins can spread upgrade costs over time rather than paying everything upfront. Full details of the scheme are still being confirmed.

What to do now

2030 might feel distant, but contractors and assessors are already stretched in some areas, and costs tend to rise the closer you get to a compliance deadline. Here is a sensible approach:

• Check your current EPC rating. If your property already holds a valid Band C under the existing system, you have breathing space until your certificate expires. You will still need to reassess your position once the new system launches in 2027.
• Identify your weak points. Loft insulation, cavity wall insulation, floor insulation and glazing are usually the most cost-effective first steps. A qualified energy assessor can tell you what your property specifically needs.
• Think about your heating route. If your property has a gas boiler and you want to use the heating metric to achieve compliance, you will need to replace it with a heat pump or another low-carbon alternative. If you would rather keep the boiler, plan for the smart readiness route.
• Budget over time. The cost cap covers a ten-year window, so there is no need to do everything at once. Spreading works across two or three years is perfectly reasonable.
• Watch for Warm Homes Fund announcements. Grant and loan details are still being confirmed. Keep an eye on government guidance as the scheme opens to applications.

The bigger picture

These changes are part of a clear direction of travel: rental properties need to become more energy-efficient, and landlords who plan early will be in a far stronger position than those who wait until 2029 to act.

The new system is not without critics. Many landlords have raised concerns about the cost and feasibility of upgrade work, particularly on older or lower-value properties. The exemption route and cost cap offer some protection, but the expectation is that most landlords will need to invest.

If you have questions about managing your rental property and staying on top of compliance, we are here to help. Whether you need a great tenant for a well-maintained home or prefer the ease of a fully managed service, Moovehub keeps landlord life simple at a flat fee.

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