As a business, we’ve spent well over 20 years working with brokers to support them in a variety of specialist markets and a large proportion of this work commences way before we actually get to see any of these cases.
This revolves around establishing relationships with a variety of lenders, getting to know their policy, criteria and processes inside and out, outlining the available options to our introducers and helping them understand how a client scenario may fit within one of these options.
Over these years, the role of the packager and the tools at our disposal have evolved in many ways but the fundamentals remain the same – to open doors which allow our introducers to meet more of their client’s specialist needs and to service these needs in the most efficient, effective and responsible way possible.
Simple right?
In theory, most certainly. However, in practice, the industry’s constantly moving parts, the impact of economic influencing factors plus regulatory and legislative change are always generating their fair share of challenges.
But where there are challenges, there are also opportunities. If brokers know where to look and how to overcome them that is. One area which should certainly be on their radar is Energy Performance Certificates (EPCs) and clients shifting attitudes towards energy efficiency. Especially as there remains a lack of awareness around the proposed changes to EPC requirements.
This was evident in recent data from Mercantile Trust which found that 48.5% of brokers were not confident that they fully understood the government’s proposed new rules regarding EPCs for rental properties. Meanwhile, 49.2% of brokers said their property investor clients had not asked them for any information on the EPC regulatory changes.
The research also revealed that 60% of brokers have not arranged a bridging loan to finance energy efficiency-related refurbishments over the past year but that 66% predicted they would do more business in this area over the coming 12 months.
Changes to EPC requirements are due to come into force in 2025, when all properties covered by a new tenancy agreement will need an EPC rating of C or above. All rental properties will need to meet this standard from 2028. Failure to comply risks a fine of £30,000 per property.
Understandably, these proposed changes are emerging as a primary concern for many landlords. A growing number of which are already getting ahead of the curve and focusing on properties which will meet the new minimum standard when adding to their portfolios. However, with a large proportion of existing portfolios being home to high levels of older housing stock, there will be an increased focus on the specialist lending markets to help finance any improvements in order to secure an EPC rating of C or above.
Short-term finance will play an increasingly important role within this transitional period and establishing a strong relationship with a trusted packaging partner will place brokers in a much stronger position to help landlords and property professionals to bridge this EPC gap now, and in the future.
Donna Wells is managing director at Envelop