LETTING & ESTATE AGENT

Green Deal - is it really such a good deal for landlords?

Green Deal - is it really such a good deal for landlords?

Most recent reports suggest the scheme would take 160 years to survey all the homes in UK. Most importantly, only some 813 homes have taken or committed to take out Green Deal loan in 2013. That does not sound like a success when you compare it with the government projection of 130,000 households taking up the loan in 2013. That equates to less than 1%.

Most recent study IPPR suggests that there are number of reasons why the scheme is failing to deliver:

-  households must pay for energy assessments,

-  the interest rate (around 8%) for the Green Deal loan means that any savings on the bill go towards loan repayments (so you do not actually necessarily see the saving in your pocket),

-  homeowners feel uneasy to take up the loan since it will be registered as a charge on the property. This could have detrimental effect on the sale of the property in the future (at least until Green Deal becomes more common.

 

IPPR sets out a number of proposal that could lead to an increase in number of implementations as well as the efficiency of the scheme in targeting fuel poverty (not to mention ‘real savings’ for individual households). Full details can be found here.

Sam Zalewski has had conversations with quite a few landlords regarding the Green Deal since it’s introduction earlier this year. It may sound like a good idea to start with as it will have no effect on the tenant’s energy bills. This might be correct but only as long as the same tenant who was occupying the property during the Green Deal measure implementation continues to live in the property. The moment you will be looking for a new tenant, you will need to explain to them that apart from paying for electricity and gas they will also be making loan repayments added to their electricity bill... and try to convince them that they are not going to be worse off. Somehow, I cannot see them not walking off. It is such a rare thing for any tenant to come across and with so little information it might be a difficult task.

Sam, however, ensures that any landlord who would wish to take part in the Green Deal can count on full support from the team at Martin & Co in Merthyr Tydfil when it comes to letting and re-letting the property. The office already has number of strategies prepared in order to deal with marketing and letting of such properties.

(quick update: According to the Department for Energy and Climate Change, 1,173 households have committed to taking part in the scheme)