The Energy Performance Diagnostic (DPE) has become essential in real estate. Beyond a simple administrative formality, it now directly influences the value of a property and its rental profitability. For an investor, the DPE is no longer just a number on an energy label: it determines the purchase price, the amount of rental income, and even the possibility of renting the property under certain conditions.
With the rise of regulatory requirements and the increasing attention of tenants to energy costs, understanding the link between DPE and profitability has become essential. A well-rated property can attract tenants more easily, rent for a higher price, and appreciate in value, while a poorly rated property may see its rental profitability fall or require energy renovation work.
In this article, we will explain to you concretely:
how the DPE impacts your rental profitability,
what the real effects are on the value of your property and on your rents,
and above all, how to avoid pitfalls and anticipate constraints related to poor energy performance.
Whether you are already a landlord or a future investor, understanding the impact of the DPE on your finances has become essential to secure and optimize your real estate project.
The DPE, a determining factor for property value and rental income
The Energy Performance Certificate (DPE) is now one of the most scrutinized criteria in a real estate listing. Where once the focus was almost exclusively on location, area, or the general condition of the property, the DPE has become an essential indicator that directly influences the market value and the rental value of a property.
Why? Because it provides clear and standardized information about the energy consumption of a property and, consequently, its operating cost. For a buyer as well as for a tenant, the DPE is not just a letter displayed in an announcement: it is an estimate of the budget that will need to be dedicated each month to energy bills.
The impact of the DPE on market value
In the sales market, a well-rated property (A, B, or C) enjoys an immediate competitive advantage. Buyers know they will not have to bear high energy costs and that they will not be faced with legal restrictions on renting. This directly translates into a value premium. Studies conducted by notaries and ADEME confirm that a high-performing property can sell for 5% to 15% more than a similarly situated poorly rated property.
Conversely, a poorly rated property, particularly those rated F or G, mechanically suffers a significant depreciation. Buyers immediately factor in the high energy costs but also the prospect of mandatory energy renovation work to be able to rent it out in the future. These properties, referred to as "thermal sieves," can lose up to 20% of their value in certain areas.
In short, the DPE acts as a lever for valuation or, conversely, as a factor for depreciation. Even if two properties have the same assets (location, area, exposure), their market price can diverge significantly based on their energy rating.
The impact of the DPE on rental value
On the rental side, the effect is just as strong. A well-rated property attracts more candidates, rents out more quickly, and, in some cases, can justify a slightly higher rent. Why? Because tenants no longer look solely at the rent amount, but also at the overall out-of-pocket costs: a poorly insulated property with an attractive rent can ultimately cost much more in energy bills.
A high-performing property (DPE A, B, or C) reassures the tenant: they know their expenses will be contained, that the property is comfortable in winter as well as summer, and that their purchasing power will be better preserved. The result: these properties generate less vacancy, fewer negotiations on rent, and better tenant retention.
Conversely, a poorly rated property (E, F, or G) is more difficult to rent. Tenants are increasingly attentive to energy performance and hesitate to enter into leases that will incur high monthly charges. Some will even use the poor DPE as a negotiation lever to obtain a reduction in rent.
Why it’s crucial for an investor
For a real estate investor, the DPE is therefore doubly strategic:
It determines the market value of the property: a poor rating reduces the ability to resell under good conditions.
It directly impacts rental income: a poor DPE makes renting more complicated, weakens profitability, and can lead to longer vacancy periods.
It is therefore essential to understand that the DPE is not just a simple technical indicator: it has become a financial valuation criterion on par with location. An investor who neglects this parameter risks seeing their property lose value and their profitability decline.
In summary: a good DPE improves the market value and secures your rental income, while a poor DPE leads to depreciation, decreased attractiveness, and regulatory constraints. That is why it has become a central element of any real estate investment strategy.
In summary: a good Energy Performance Certificate (DPE) improves the market value and secures your rental income, while a poor DPE leads to depreciation, decreased attractiveness, and regulatory constraints. This is why it has become a central element of any real estate investment strategy.
Rules related to a poor energy performance diagnosis (DPE): prohibitions, rents, and upcoming changes
You understood that the DPE (Energy Performance Diagnosis) is essential for evaluating the rental value and the market value of your property. But are you aware of the legal obligations that apply to poorly rated housing? Here’s what you need to know to avoid pitfalls and anticipate regulatory changes.
Progressive prohibition of renting thermal sieve properties
The Climate and Resilience Law severely regulates the rental of energy-intensive housing, according to this timeline:
Since January 1, 2025, all properties classified G are prohibited from being rented, except for very limited exceptions.
Starting January 1, 2028, it will be the turn of properties classified F to be prohibited from being rented.
As of January 1, 2034, properties classified E will also be affected and will no longer be able to be rented.
This means that soon, only properties classified A, B, C, and D will remain allowed on the rental market. A significant constraint for real estate profitability, as a non-rentable property no longer covers its expenses!
Rent freeze on poorly rated housing
Since 2022, properties classified F or G are subject to a rent freeze: it is prohibited to increase the rent, whether during a renewal or a re-rental.
As a result: your rental income stagnates, even if costs (maintenance, taxes, etc.) continue to rise, directly impacting the net profitability.
Mandatory mention in advertisements
Since 2022, real estate advertisements must clearly indicate, for properties classified F or G, the following mention:
“Property with excessive energy consumption”, in order to inform the future tenant or buyer from the outset.
This transparency can deter some candidates, especially in a tight market context.
What changes in 2026: a revised calculation method
A major reform of the DPE is planned for January 1, 2026: the conversion coefficient of electricity, used in performance calculation, will be lowered from 2.3 to 1.9.
Expected consequence:
Approximately 850,000 properties currently classified F or G, especially those heated with electricity, could automatically move up to D or E without renovations.
This will allow the affected owners to escape planned rental prohibitions and improve their rental and market value, without undertaking immediate renovation.
Strategic reminder for a savvy investor
A poor DPE (F or G) = risk of vacancy, loss of income (freeze of rents), obligation to mention in the announcement, and the prospect of a rental ban depending on the timeline.
The 2026 reform provides a breath of fresh air for certain properties, but beware: this reclassification for properties heated with electricity is still conditioned on the calculation method, and does not necessarily guarantee better comfort or improved insulation. The tenant might still consider the housing uncomfortable.
Should we renovate our energy sieve and improve its energy performance certificate or sell it?
This is the big question that many landlords are asking today. When a property is classified as F or G in the energy performance certificate (DPE), it becomes not only more difficult to rent but also less attractive for resale. So, what to do: invest in energy renovation or sell the property as it is?
Assessing the impact on your property's value
The first step is to compare two elements:
The loss of value caused by a poor DPE: an energy sieve can suffer a discount of 15 to 20% on the market, even more in tight areas.
The cost of energy renovation work: on average, you should budget between €350 and €400 per m² to significantly improve the energy performance of a property.
Concrete example: for a 50 m² apartment, a complete renovation can cost about €18,000 to €20,000. If this work prevents a discount of €40,000 at resale, then the renovation is a profitable investment.
The logic of rental profitability
If your goal is to keep the property for rent, energy renovation becomes essential. A property with a better classification in the DPE:
can again be legally rented,
attracts more tenants,
limits downward negotiations,
and above all, generates regular rental income instead of forced vacancy.
In other words, the work allows you to move from a property that cannot be rented to a property that can be rented and yields profit.
When selling remains an option
However, there are situations where renovation is not the best option:
If the amount of the work is disproportionate compared to the value of the property.
If the property is located in an area where rental demand is low.
If your strategy is to reinvest in a more efficient property, without tying up additional capital.
In this case, selling “as is” can be a relevant decision. The buyer, aware of the work to be done, will use this argument to negotiate the price down, but you will avoid having to bear the cost of renovations.
The Beanstock Advice
Before deciding, do your calculations:
Compare the discount related to a poor energy performance diagnosis (DPE) with the estimated cost of the works.
Keep in mind that energy renovation, even expensive, protects your rental income and increases the market value of your property.
On average, between €350 and €400 per m² is enough to transform an energy sieve into a high-performing, attractive, and profitable home.
At Beanstock, we always advise investors to analyze this cost/benefit ratio before making a decision. In most cases, renovation not only helps to preserve rental profitability, but also significantly increases the property's value over the long term.
At Beanstock, we support you in your energy renovation projects.
How to finance an energy renovation and maximize its profitability?
1. Available Financial Aids
Energy renovation is a national priority, and the State has implemented several measures to assist property owners.
MaPrimeRénov’
This is the main aid from the State.
It is aimed at both owner-occupiers and landlord owners.
The amount varies depending on your income, location, and the type of work (insulation, heating replacement, ventilation).
In some cases, it can cover several thousand euros of work.
Energy Savings Certificates (CEE)
This scheme requires energy suppliers to finance part of the energy renovation work.
In practice, you receive an energy bonus from a supplier (EDF, TotalEnergies, etc.) if you carry out eligible work.
Cumulable with MaPrimeRénov’, which can significantly reduce your out-of-pocket expenses.
The interest-free eco-loan (éco-PTZ)
Bank loan of up to €50,000, with no interest.
Ideal for financing part of the work without increasing the overall cost of your financing.
Repayable over 15 to 20 years.
Local Aids
Many regions, departments, or local authorities offer their own bonuses.
Sometimes cumulable with MaPrimeRénov’ and the CEE, they can finance part of the insulation or equipment.
Example: some regions finance up to 50% of the cost of an energy audit.
👉 By combining these measures, you can drastically reduce your out-of-pocket expenses. In some cases, more than 50% of the work can be financed by aids.
2. Integrating the work into your real estate financing
If you are buying a property to renovate, you can directly include the cost of the work in your mortgage. The bank then finances both the purchase and the renovation, simplifying your cash flow management.
Another option: debt consolidation. If you already own a property with a poor energy performance diagnosis (DPE), you can consolidate your loans and include new financing for the work. This allows you to benefit from a competitive interest rate and spread the burden over several years.
Of course, this impacts your APR, but in the long term, the benefits are considerable:
the property regains a higher market value,
it becomes legally rentable,
and your rental income is secured.
3. Determining profitability after work
Before starting, it’s essential to compare:
the cost of the work,
the capital gain you can derive from it,
and the impact on your rental income.
On average, energy renovation costs between €350 and €400 per square meter.
For a 60 m² apartment, you should therefore budget around €21,000 to €24,000 for the work.
If this work allows:
to move from a DPE F to a DPE C,
to avoid a discount of 15 to 20% upon resale,
and to secure a monthly rent of €900 instead of €700 (thanks to better attractiveness),
… then the operation quickly becomes profitable.
Tip: always simulate the value after work (market price + potential rents) before making your decision.
4. Tax advantages related to energy renovation
Beyond the aids and financing, energy renovation opens the door to several tax optimizations.
Under the LMNP (Non-Professional Furnished Rental) regime: renovation expenses can be deducted from rental income, reducing your taxable base.
In property income: energy renovation expenses can be deducted from your collected rents, which decreases your taxation.
In some cases, the VAT applied to energy renovation work can be reduced to 5.5% instead of 20%.
These tax devices further enhance the profitability of a renovation project.
The Beanstock advice
At Beanstock, we assist investors in analyzing this type of decision: should we renovate or sell?
Our advice is simple:
Compare the actual cost of the work to the loss of value of the property if you do nothing.
Include financial aid and tax benefits in your calculations.
Always think long term: an energy-efficient home is a property that rents better, sells for more, and remains attractive even in the event of regulatory tightening.
On average, with a budget of €350 to €400 per m², you can transform an energy sieve into a rental, attractive, and profitable home.
Conclusion: the DPE, a major issue for preserving the profitability of your investment
The Energy Performance Certificate (EPC) is no longer just a mandatory document: it is a key criterion that influences the market value of your property, its rental value, and therefore the profitability of your real estate investment.
A poor EPC (F or G) leads to a significant decrease in resale value, complicates rental arrangements, and may even completely block your rental income with upcoming legal prohibitions. Conversely, a good EPC enhances your property, attracts more tenants, and secures your rents in the long term.
In light of this reality, two options are available to you: renovate or sell. Energy renovation incurs costs, but it often proves profitable thanks to available aids, tax benefits, and property revaluation. Selling, on the other hand, remains an option if the work is disproportionate, but it involves an immediate decrease.
Our Beanstock advice: always consider renovation as a strategic investment, not as a burden. By improving the energy performance of your home, you turn a regulatory constraint into an opportunity for valorization and profitability.
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