Rising energy costs becoming great concern to property developers & investors

Iqbal Singh Sekhon recognising this issue states that these “extortionate increases could result in devastating effects for property owners, landlords and tenants with tenants being forced to choose as to whether they pay for other essential items”. If tenants elect not to pay their rent, inevitably, landlords will face difficulty in meeting their mortgage costs which could result in an increase in repossessions and other devastating financial difficulties for landlords. This has serious knock on implications which could further drive up costs to both tenants and landlords.

This is of serious concern and the Sekhon Group say they are not alone in this concern but it is widely shared with all the other property developers and landlords. It is especially difficult when tenants who have young children plead for a deferment of rent. Iqbal Singh Sekhon says mostly we are all family people and one’s heart goes out to families who find themselves in this difficult crisis. 

“Therefore the only way to resolve this national crisis is through shared responsibility and government intervention” Iqbal Singh Sekhon states. “We cannot continue to be reliant on imported energy and must instead provide sustainable solutions for the long-term and have a huge investment program again in renewable energy including solar, hydro, ground, wind and geothermal methods”. Iqbal Singh Sekhon urges the government to subsidise on a higher level than they have attempted to do so in the past.

This will enable landlords to implement these vital sources of energy which would inevitably avoid these dilemmas which the country is facing. With a greater infrastructure of solar energy and more government aid and encouragement, landlords and property developers can utilise solar panels and other sustainable and more affordable energy options.

In addition to this Iqbal Singh Sekhon says that “insulating properties is also vital” and whilst the modern building regulations system insures greater insulation to new properties, “there must be a solution found for older properties which are either listed or of heritage value”. Insulation is vital to keeping heating (and therefore energy) costs low; however although it is found in all newer build properties, older buildings with heritage and protection often miss out as it can be costly and difficult to retrofit them with insulation without damaging the property.

Iqbal Singh Sekhon was only recently involved with his business partner Mr Karamjit Singh Sodhi of Euro Connect Properties who developed The Deal House (part of the wider Sekhon Group portfolio) in a sustainable and sympathetic manner which has achieved a milestone achievement in creating one of the highest energy performance certificate ratings achievable in the Waterloo area of Huddersfield.This was widely reported in the media as being one of the most energy-efficient buildings of its kind and Iqbal Singh Sekhon says that it is developers like this that the government needs to support further and guide them towards these alternative options. These sustainable energy options are the future both in relation to inflated energy costs as well as environmental impact so adopting them now will help to bring awareness and create a new industry standard that benefits all.

Mr Sodhi stated that this was only possible as a result of the ‘Government Feed In tariff’ incentive and had that not been the case, then he would not have been able to install this system which has been hugely beneficial to the property. However, the problem is now that the feeding tariff government support scheme which enabled this to happen has been greatly reduced which has taken away the incentive for developers. If the prior tariff remained at its original rate then more property developers would be encouraged to implement similar systems into their developments.

Mr Sodhi sites a highly successful government backed incentive in Europe which deals with making properties more energy-efficient and this model should be adopted by the United Kingdom. It is known as the next generation European incentive for renewable energies which covers old and new properties not limited to residential properties as it also covers commercial properties.

It is clear that energy Price increases will lead to higher inflation and hit the poorest members of our community which just does not seem fair. The only way people will be able to survive is to demand higher wages from their employers but how do the people who are on benefits or low income survive. It would be unfair for landlords to have to absorb all of this financial detriment which may inevitably become the case which may see landlords go into insolvency if this matter is not dealt with quickly. Put simply, it looks to be a lose-lose situations unless there is immediate intervention to prevent financial difficulties to all involved.

The knock-on effect of this will be that there will be less landlords willing to enter this market and therefore add to the National Housing crisis which is already at breaking point, causing further issues in the future to those looking to rent.

Iqbal Singh Sekhon says that where his properties have token metres or submeters then he only charges what the energy company charges the company as it he believes it is immoral to make a profit from this process as some landlords attempt to do; he urges landlords not to take advantage of this situation nationally.

Click here to find advice on energy bill price caps if they are effecting you:  https://www.ofgem.gov.uk/information-consumers/energy-advice-households/check-if-energy-price-cap-affects-you