Green is gold: 92% of tenants will pay more for energy-efficient homes, say investors

June 2025

Demand for green features like heat pumps, solar panels, and EV chargers surges
77% of landlords report tenants are actively requesting sustainable upgrades
36% say proposed EPC reforms make them positive about the market, while 56% see no negative impact

As many large corporations step back from green commitments, a surprising force is driving the sustainable property agenda forward: tenants. According to new research from Handelsbanken’s Property Investor Report 2025, an overwhelming 92% of UK property investors believe tenants are willing to pay more for greener homes, with 77% reporting a surge in demand for sustainable features like heat pumps, solar panels, and electric vehicle charging points.

In a property market shaped by economic headwinds, evolving regulations, and shifting consumer expectations, sustainability has become more than a buzzword, it’s a business strategy. The report, based on a survey of 200 professional landlords and property investors across the UK, reveals how tenants’ priorities are reshaping the rental landscape, offering landlords a clear opportunity to future-proof their portfolios.

Chris Teasdale, Chief Branch Officer at Handelsbanken, commented:

“Sustainability isn’t just an ethical choice; it’s a smart investment strategy. Tenants are telling us loud and clear they want greener homes, and they’re willing to pay for them. For landlords, this is a clear signal to act. Those who invest in sustainability now are better placed to attract tenants, command higher rents, and secure long-term returns.”

The report’s findings come at a time of mixed signals for the property sector. While geopolitical tensions, inflation, and regulatory shifts, like EPC reforms and the Renters’ Rights Bill, pose challenges, investor sentiment remains remarkably resilient:

54% of property investors plan to expand their portfolios over the next 12 months
80% expect their portfolio values to rise, despite market uncertainty
36% say proposed EPC reforms make them more positive about the market, while 56% see no negative impact

This resilience is underpinned by a growing recognition that sustainability sells. The report reveals that in tenant conversations, requests for green features are no longer niche:

77% of landlords report tenant interest in heat pumps, solar generation, and other sustainability upgrades
57% say tenants are asking for EV charging points
47% cite demand for higher Energy Performance Certificate (EPC) ratings (C or above)

James Sproule, UK Chief Economist at Handelsbanken, commented:

“Green is gold. Sustainable properties aren’t just good for the planet, they’re good for business. In a market where competition is fierce and tenants have choices, going green is the edge that can make the difference. Those who adapt will thrive; those who don’t risk being left behind.”

This shift in tenant priorities comes as many large corporates are quietly stepping back from their sustainability targets, caught between rising costs and uncertain market conditions. Yet the Handelsbanken Property Investor Report 2025 suggests that, for property investors, the opposite is true: sustainability is a growth opportunity.

Sproule continued:

“For years, green standards were seen as a regulatory headache. But our research shows that investors increasingly see them as an opportunity to add value. The message is clear, if you’re investing in property, sustainability isn’t optional anymore, it’s essential.”

The Handelsbanken Property Investor Report 2025 paints a picture of a sector at a crossroads. Against a backdrop of global uncertainty, the UK property market is holding steady, but the winners are those who embrace change. Landlords and investors who align with tenant demands for greener living, diversify their portfolios, and navigate regulatory shifts with confidence are the ones best positioned to thrive in the years ahead.

-ENDS-

Media enquiries

Patrick Evans/Marcus Dell

Citigate Dewe Rogerson

Notes to Editors

*Handelsbanken commissioned research in March 2025 through independent research company Pure Profile among a panel of 200 larger portfolio property investors across the UK.

Information on Handelsbanken plc

Handelsbanken is the trading name of Handelsbanken plc, which is incorporated in England and Wales with company number 11305395. Registered office: 25 Basinghall Street, London, EC2V 5HA, UK. Handelsbanken plc is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Financial Services Register number 806852.

Handelsbanken plc is a wholly-owned subsidiary of Svenska Handelsbanken AB (publ).

Handelsbanken was established in Stockholm in 1871 and in Sweden, it is one of the country’s leading banks with a nationwide branch network. The Bank’s home markets are Sweden, Norway, the Netherlands, and the UK. It also has operations in Luxembourg and the USA.

In the UK, Handelsbanken is a relationship bank with a decentralised way of working, a strong local presence due to a nationwide network of branches, and a long-term approach to customer relations. Handelsbanken specialises in providing personalised and competitive banking services to both businesses, individuals, and property investors, and offers wealth and investment management services through its UK subsidiary Handelsbanken Wealth & Asset Management. Each Handelsbanken branch operates as a small business enabling it to make decisions at a local level and provide a bespoke service. The focus is always on the need of the individual customer and not on the sale of specific products.

For information regarding sustainability at Handelsbanken, please see here: https://www.handelsbanken.co.uk/en/about-us/sustainability. Opens in a new window