The impact of Storm Éowyn in January might have just caused you a night of disturbed sleep but if you were in an area that was badly affected, you may have suffered significant damage and loss of power.

We often talk about a ‘storm brewing’ or ‘a perfect storm’ when referring to property investing, and in this outlook for 2025 I predict that the ‘winds of change’ are definitely blowing in the HMO space.

The Energy Efficiency Squeeze
Although the EPC regulatory changes were part of the Labour party’s manifesto under the Warm Homes Plan, as yet a formal bill has not been drafted, which would enforce rental properties to meet EPC C by 2030. A government consultation is currently underway (ending on 28 February 2025), which seeks to understand views about how the current EPC regime is working and whether it needs upgrading - I suspect this will be a primary measure and will allow further potential exemptions. This approach is being seen by some as procrastination by the government on the EPC promises that all rental properties will have to be at least a C by 2030.

Happily, there is acknowledgement in the consultation of the unique category that HMOs play in the rental market, and a guarded implication that HMOs may well avoid having to meet these stringent requirements - if they are passed.

Meanwhile, regularly reviewing your energy management is vital. Whether that’s by changing your energy supplier (both standing order costs and unit costs have to be assessed), regularly taking meter readings (smart meters can help), or ensuring proactive management of heating in your property - these are all ways to cut costs and make your energy bills more palatable. I’ve found that educating tenants about our heating policy is useful - we have a set pattern dependent on the weather, and all thermostats are controlled carefully. This has made our HMOs much more efficient - and many of them do not have solar panels or heat pumps to further defray the costs.