Landlords urged to check EPC ratings or risk losing income

Private rental landlords across England and Wales could find their properties classed as ‘unrentable’ from April 2018 unless they take swift action, according to a leading solicitor.

The Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015, due to come into force on April 1, 2018, will make it unlawful for landlords to agree new lets or the renewal of tenancies for properties that have an energy performance certificate (EPC) rating below E unless the property is registered as an exemption. On the energy efficient rating scale of A to G, G is the least efficient.

The regulations will apply to all non-exempt domestic rental properties from April 1, 2020, including pre-existing tenancies.

With at least one in six private rental properties reportedly set to fall below the required standard, legal expert Danielle Hughes from Kirwans law firm is urging landlords to improve their EPC ratings now in order to avoid huge problems next year.

“Landlords have been hit with a raft of new regulations over the past 18 months, and many have found it extremely difficult to keep up with the increasing obligations and ever-changing legislation,” explained Danielle.

“As a result, I have serious concerns that many landlords may be completely unaware that their properties could fall below the new minimum legal requirements for energy efficiency standards in England and Wales.

“This would mean that they could unknowingly be letting “sub-standard” property in direct breach of the new Regulations. Landlords would be at risk of prosecution, which must be enforced by local authorities with a civil penalty of up to £5,000 imposed for breaches. The local authority must also serve a compliance notice upon the landlord, asking them to bring the property up to the required standard”

The new legislation covers self-contained flats, and while bedsits do not strictly require an individual EPC, if the bedsit is within a property which already has an EPC, then it can only be rented out if regulations have been adhered to.

However, there are some exemptions; notably buildings and monuments officially protected as part of a designated environment or because of their special architectural historical merit. This includes some listed buildings.

Other excluded domestic properties include temporary buildings with a planned timed use of two years or less; residential buildings which are intended to be used less than four months of the year, and stand alone buildings with a total usable floor area of less than 50 square metres.

Hundreds of landlords are expected to be affected by the new laws, according to data released by Urban.co.uk. The online estate agency questioned 4,000 UK landlords on a number of UK rental market issues though its Landlord Knowledge Survey report, and its findings backed up Danielle’s fears that many existing private landlords are simply unaware of the new minimum energy efficiency requirements.

But, Danielle explained, there are moves that they can take now to bring their properties up to the standards required.

She said: “Some properties may only need a couple of inexpensive tweaks to bring them in line with the new regulatory requirements, while others may require substantial works, which come at a cost. Landlords have to balance this work against the risk of them being in breach of the legislation and facing a criminal conviction and penalty fine. As long as the rating is at a minimum of E, it is up to them which methods they chose to improve the property.

“Careful assessment of the options and setting an appropriate plan of action over the next 12 months is the best way to ensure that the properties are ready and fully compliant by April 2018. Planning now will also have the obvious benefits of spreading the cost and making sure that the relevant third party contractors are available to undertake any necessary work.

“Before scheduling a visit from a Domestic Energy Assessor, landlords should spend some time looking at the different methods of improving their property’s energy efficiency rating and chose which is right for them.””

Top five ways to improve your property’s energy efficiency rating:

Insulation

Fit new loft insulation so that it measures at least 270mm in depth. Look into grants and funding opportunities to see if your property qualifies. Ensure that any cavity walls are also insulated.

Heating

If you’re able to invest a little more, then consider replacing an old boiler with a new condensing one. As well as hugely increasing your EPC score, this could reduce running costs by hundreds of pounds each year, making the property much more attractive for prospective tenants. If you want to boost your EPC score even further, then why not look at introducing updated heating controls too, such as boiler programmers, room thermostats and individual Thermostatic Radiator Valves (TRVs).

Lighting

There are plenty of ways to improve lighting efficiency, but switching from halogen to more energy efficient lighting will have a big impact for relatively little cost. Introducing Low Energy Lighting (LELs), Compact Fluorescent Lights (CFL) or Light Emitting Diodes (LEDs) can make a real difference.

Double Glazing

Replacing single-glazed windows with double-glazed units will have the dual effect of sprucing up your property and giving its energy efficiency rating a boost.

Draft-proof doors and windows

Look around windows, doors, loft hatches and floorboards in order to identify draughty areas, then address the best way to prevent the draught, be it excluders, fillers, curtains etc. The Energy Savings Trust estimates that the materials for draught-proofing an entire property could cost between £85.00 – £275.00 if you want to do it yourself, while hiring a professional could cost considerably more.

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Daniel Peacock