Tenants in England are now paying around £85 more per month for energy-efficient homes, as demand for greener rentals continues to outstrip supply and reshape how landlords approach property investment.
Caroline Marshall-Roberts, founder of BuyAssociation, outlines five areas where sustainable upgrades can strengthen a landlord's property investment.
Attracting higher-quality, long-term tenants
Properties with sustainable features tend to appeal to environmentally conscious, financially stable renters, often young professionals or families seeking comfortable, efficient homes. These tenants are more likely to stay longer, reducing void periods and management costs, while also being more inclined to care for the property and limit the risk of costly damage.
Justifying higher rent
Green features such as solar panels, insulation, and electric vehicle charging points can make it easier for landlords to command higher rents, particularly when tenants recognise the savings on offer through lower energy bills. Renters are often willing to pay a slightly higher rent if they anticipate significant reductions in their monthly utility costs.
Protecting against future costs
With net-zero deadlines approaching, tighter policies around building standards and environmental performance are becoming more common. Landlords who invest in green upgrades now can avoid the expense of retrofitting further down the line and reduce the risk of falling foul of new regulations. These upgrades may also open access to green finance options, making it easier to improve other parts of a portfolio while staying ahead of legislative change.
Lower maintenance bills
Many green features are built using durable, high-quality materials designed to last, which can keep day-to-day maintenance costs down. Smart systems built into some properties can also flag problems early, allowing landlords to carry out smaller repairs before they escalate into more expensive issues.
Standing out in a crowded market
With rental prices and energy costs both elevated, tenants are increasingly focused on value. Landlords offering eco-friendly features gain a genuine competitive edge, particularly as many properties on the market still lack them. For renters weighing up both their environmental impact and their monthly outgoings, a green home can tick both boxes.
Marshall-Roberts says the shift reflects both government policy and the ongoing pressure of rising living costs. "Over the past few years, we've seen a big increase in demand for greener living," she said. "This is partly due to the government's net-zero push, but also because energy bills have gone through the roof.
"With the cost of living rising, tenants are thinking more carefully about their bills. This is especially true for those on lower incomes or trying to save for a deposit. In many cases, paying a bit more for green features is worth it, as the long-term savings on utilities can be substantial.
"Properties with energy-saving features are advantageous for landlords as well. In competitive markets, these properties tend to be rented out faster, leading to improved returns and reduced vacancy periods."
