Worrying research shows thousands are unaware of the looming deadline on the introduction of new energy efficiency regulations. This time next year, landlords will no longer be able to let properties or renew an existing tenancy if their property has an EPC rating below ‘E’.
A recent survey by online letting agents Urban revealed that 20% of landlords surveyed didn’t know anything about the existing regulations.[1] While 17% were unaware that energy efficiency regualtions are set to tighten from April 2018.[2] This means that letting agents will have to act promptly to ensure their landlords avoid hefty penalties.
We’ve provided a useful point of reference for clueing up landlords quickly and getting them on board with making the necessary changes in time for the deadline.
What’s the point of an EPC?
An Energy Performance Certificate (EPC) rates your home’s energy efficiency from G to A, with most homes in the UK scoring a D rating.[3]
Previously more relevant for the sales markets, savvy tenants are now factoring in how highly a property scores and the impact this will have on their own energy bills - when the time comes to renting a property.
How do I know if my property will be affected?
Estimates of how many properties fall below the desired rating vary wildly, ranging from one in six to one in twelve. Although there are exemptions (properties with a pre-existing tenant, some historically listed buildings as well as temporary buildings or residential buildings in use for less than four months of the year) the vast majority of rentals will qualify so it’s worth booking a visit with a Domestic Energy Assessor.
What’s in it for me?
Avoiding a big fine and a criminal conviction!
Landlords in breach of the regulation could be hit by a £5,000 fine and a criminal charge. Aside from the negative ramifications, letting agents should also remind their landlords of the benefits to improving their EPC ratings.
Government estimates suggest a higher rating could add up to £16,000 to a property's value as well as being an attractive pull to tenants looking for cheaper energy bills.[4] Most importantly, adhering to the EPC regulations ensures that landlords are keeping tenants safe from the associated risks of poor insulation and ineffective heating systems.
What’s the most efficient way for me to make the change?
There are a number of smaller tweaks landlords can make to make a property more energy efficient:
- Replace all lightbulbs with LEDs, CFLs or LELs to give your rating a boost
- Make sure all wall cavities are filled so heat doesn’t escape
- Ensure your loft insulation is 270mm thick for optimum efficiency
- Double glaze your windows – the sound reduction side effects should also score points with tenants
For more drastic solutions, landlords should consider upgrading their central heating system and look at renewables, like solar or heat pumps. We reccomend that letting agents make a thorough assessment of the properties on their books, and create an action plan for the next 12 months.
Are there any other changes coming?
The legislation will be rolled out to include all domestic rental properties from April 1, 2020, regardless of whether there’s a pre-existing tenant. As yet, there are no further plans for additional changes to EPC legislation.
[1] https://www.landlordtoday.co.uk/breaking-news/2017/2/almost-17-of-homes-could-become-unrentable-by-2018
[2] https://www.landlordtoday.co.uk/breaking-news/2017/2/almost-17-of-homes-could-become-unrentable-by-2018
[3] http://www.lcea.co.uk/epc-ratings-explained/
[4] http://www.thisismoney.co.uk/money/mortgageshome/article-2345737/It-pays-green-Energy-efficient-homes-attract-higher-prices-time-sell.html
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