Rental Properties Must Have EPC
Above “Band E” By 2018
The Department of Energy and Climate Change (DECC) says that from April 2018, UK private rented sector (PRS) landlords will become legally required to raise the energy efficiency of rental properties in the private sector to at least “Band E” in energy efficiency standards.
From April 2016, landlords in the private rented sector (PRS) will also be required to accept reasonable requests from tenants for energy efficiency measures to be installed in rented properties.
This means that hundreds of thousands of landlords with buy-to-let mortgages could be hit with bills of up to £9,000 (GBP) under the new green targets set out to make rental properties more energy efficient.
The Energy Performance Certificate (EPC) ranks a property’s energy efficiency from A for the most well-insulated and energy-saving properties, to G for the worst.
The new reforms mean that more than 450,000 rental properties which fall into EPC bands F and G, the worst insulated properties, will require significant work to be carried out on them.
While some landlords will be able to benefit from loans under the Green Deal, experts said many would choose to foot the bill for new EPC efficiency themselves rather than deal with the bureaucracy of the system.
However, the amount available will be capped, meaning landlords cold be forced to foot the bill for more expensive energy efficiency measures themselves. Solid wall insulation can cost up to £9,000.
Landlords will be able to access financial support through schemes such as the Green Deal and Energy Company Obligation for measures such as new boilers and insulation, and will only have to carry out cost-effective improvements.
The new regulations are set to include some exemptions, for example, if works are deemed too costly or a property is impossible to make more energy efficient.
Richard Lambert, Chief executive of the National Landlords Association, (NLA), offered his views on the announcement, stating: “The Government has struck a delicate balance between making clear what is expected and ensuring that there is a realistic prospect of landlords being able to comply. Setting the EPC standard at a sensible rather than aspirational level, allowing time to achieve it and granting exemptions if the necessary improvements cannot be funded through the Green Deal or other government subsidies means that these new regulations will not impose an unreasonable burden. Indeed, where a landlord is in a position to undertake improvements, there will be no good reason not to. The NLA actively encourages landlords to improve the energy efficiency of their properties because it’s good business practice: a warm tenant is a happy tenant.”
However, Friends of the Earth have said that the new EPC rules don’t go far enough, with a spokesman stating: “The new regulations only ban the most dangerously cold homes, and are riddled with loopholes which unscrupulous landlords can take advantage of. Regulations requiring private rented homes to be insulated to a far higher standard are vital to prevent cash-strapped tenants shivering in heat-leaking homes, and to help reduce the nation’s contribution to global climate change.“
A DECC spokesman said: “There will be no upfront costs to landlords so it’s not going to cost them thousands to get new EPC’s. Landlords can obtain money through the Green deal, eco or other subsidies so they don’t lay out money upfront. Depending on what improvements the property needs would also determine how much it will cost.”
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