Air source heat pump for landlords: grants, EPC and installation
An air source heat pump for landlords can replace a gas, oil, LPG or electric heating system with a low-carbon one, and the Boiler Upgrade Scheme can pay part of the bill. This page explains which rented homes suit one, how it fits the new EPC rules and what the grant covers.
Last checked: 21 October 2026.
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What an air source heat pump does
A heat pump takes warmth from outside air and uses electricity to raise it to a useful temperature. It then feeds radiators, underfloor pipes and a hot water cylinder. It runs gently for long periods rather than firing hard and stopping.
That style of running suits a well-insulated home. It is one reason we look at the walls and loft before we size a unit.
Air source heat pump for landlords: which homes suit one?
A good candidate has some or all of the following:
- Reasonable insulation already, or insulation planned alongside.
- Space outside for the unit and inside for a cylinder.
- Radiators that can be kept or swapped for larger ones.
- A tenant happy to live with new controls and a cylinder cupboard.
Tight terraces with no side access and flats without outdoor space are harder. Our assessor checks this on the visit and tells you plainly if it will not work.
Heat pump grant: the Boiler Upgrade Scheme
The Boiler Upgrade Scheme pays £7,500 towards an air source heat pump. From 21 July 2026 to 31 March 2027 a temporary £9,000 rate applies to heat pumps in homes heated by oil or LPG with no mains gas. The installer applies and takes the grant off your invoice.
GOV.UK confirms that a property you rent out to tenants can apply. The grant replaces a fossil fuel system such as oil, gas, electric or LPG. Social housing, most new builds and homes that already received government heat pump funding are excluded. The heat pump must be installed within 120 days of the application.
The installer must be MCS certified and sit within an approved consumer code. Our grants for landlords guide shows how this scheme sits beside the others.
Greater Manchester funding for heat pumps
Greater Manchester landlords may also use Warm Homes: Local Grant. A landlord's first property can receive 100% of eligible heating costs, up to £15,000. Later properties receive 50%, up to £7,500. The tenant household and the Good Landlord Charter conditions apply. Our Good Landlord Charter guide explains the registration.
Heat pump EPC impact under the new rules
Under the confirmed policy, a landlord must first meet a fabric standard on the new EPC. After that, the landlord can meet either a heating system standard or a smart readiness standard. A heat pump is one way to meet the heating route. The government response names Boiler Upgrade Scheme heat pumps as an option landlords may choose.
This is confirmed government policy, not yet law, as at 21 October 2026. Numeric thresholds are not published, so we do not promise a rating. Read our EPC C 2030 guide for the full position.
Does the grant count towards the cost cap?
No. The government response says Boiler Upgrade Scheme funding does not count towards the £10,000 cap, though landlords can combine it with their own money. Other third-party grants do count. The cost cap and exemptions guide has the detail.
| Question | Short answer | Where checked |
|---|---|---|
| Can a rented home apply? | Yes, if the owner meets the scheme rules | GOV.UK, 21 Oct 2026 |
| Standard grant | £7,500 for an air source heat pump | Energy Saving Trust |
| Off-gas uplift | £9,000, 21 Jul 2026 to 31 Mar 2027 | Energy Saving Trust |
| Counts towards the £10,000 cap? | No | Government response, Jan 2026 |
| Installer needs | MCS certification and a consumer code | Energy Saving Trust |
Heat pump cost
Cost depends on the size of the home, the radiators and the cylinder. Indicative price from £8,000 before the £7,500 Boiler Upgrade Scheme grant, if you are eligible (UK market research, 2026). This is not a quote: your written quote after a survey is the confirmed price.
Zero VAT applies to heat pump installation in a home until 31 March 2027, according to HMRC. The 5% rate follows from 1 April 2027.
Finance is available through our partner Ideal4Finance: 0% APR over 3 to 60 months, or 10.9% APR over 120 months. A deposit might be payable, and we will agree this before you begin your application. LAMTANS ENGINEERING LTD is an Introducer Appointed Representative of Ideal Sales Solutions Ltd, t/a Ideal4Finance. Ideal Sales Solutions Ltd is a credit broker and not a lender (FRN 703401). The rate offered is always provisional and will depend upon your personal circumstances, the loan amount and the term.
How the installation works
- Assessment: a heat loss calculation and a visit to the property.
- Design: unit, cylinder and radiator changes are specified in writing.
- Grant: your MCS installer submits the application.
- Install: the old system comes out and the new one is commissioned.
- Handover: you receive the commissioning record and MCS certificate.
Adviser tip from a Retrofit Designer: insulate first where you can. A smaller heat pump costs less to buy and run, and the grant does not change that. Ask for the heat loss calculation in writing before you accept any quote.
Who delivers the work
Compliant Lets is a trading name of LAMTANS Holdings Ltd. LAMTANS Engineering Ltd delivers heat pump work and holds MCS, PAS 2030, PAS 2035, TrustMark and RECC, plus Gas Safe registration. Our MCS inspection for air source heat pumps has been passed.
Check the registers yourself: TrustMark, RECC, ICO, Gas Safe Register and Simply Certification.
Sources
- GOV.UK: Boiler Upgrade Scheme, check if you are eligible, checked 21 October 2026
- Energy Saving Trust: Boiler Upgrade Scheme, checked 21 October 2026
- GOV.UK: Improving the energy performance of privately rented homes, government response, checked 21 October 2026
- GMCA: Warm Homes Local Grant, privately rented scheme, checked 21 October 2026
- GOV.UK: VAT on energy-saving materials and heating equipment (Notice 708/6), checked 21 October 2026
Designed & developed by LAMTANS Technologies LLC, USA — part of the LAMTANS Group
Frequently asked questions
Can a landlord claim the Boiler Upgrade Scheme?
GOV.UK says a property you rent out to tenants can apply, if you own it and replace a fossil fuel system. Social housing and homes already funded for a heat pump are excluded.
How much is the grant?
It is £7,500 for an air source heat pump. A temporary £9,000 applies to oil and LPG homes with no mains gas from 21 July 2026 to 31 March 2027.
Will a heat pump get my property to EPC C?
Not on its own. The new EPC puts fabric first. A heat pump helps with the heating route afterwards. The assessment models your property.
Do I need an MCS heat pump installer?
Yes. The installer must be MCS certified and in an approved consumer code to claim the grant for you.
Are heat pumps noisy?
Noise depends on the unit and where it stands. Position matters near bedroom windows and neighbours, so we agree it at the design stage.
Do I need planning permission?
The rules depend on the site and the unit's position. We check this at design and tell you if an application is needed.
Does the tenant need to be involved?
Yes for access, and they will use the new controls. We give you simple instructions to pass to the tenant.
Can I get Greater Manchester funding as well?
Possibly. Warm Homes: Local Grant covers heat pumps for qualifying properties and tenant households. We confirm which route fits first.
What if my home has gas?
The standard £7,500 applies. The £9,000 rate is only for homes heated by oil or LPG with no mains gas.
Is a hybrid system eligible?
We check the current scheme rules on hybrids before you commit. Do not assume a gas boiler kept alongside a heat pump qualifies.