Landlords warned over Energy efficiency rules

Landlords are being urged by Crook estate agency Vickers & Barrass to prepare for new energy efficiency rules, which come into effect from April.

The news follows Energy Performance Certificates (EPC) introduced to make buyers and tenants more aware of the energy cost and environmental impact associated with a building.

Usually containing a letter and a number together with a list of possible improvements (Recommendations), the rating scale runs from A to G (A is the most energy efficient). Under the Government’s Minimum Energy Efficiency Standards (MEES), a residential let property must achieve an E EPC rating as a minimum.

Now, with effect from the 1 April 2020, the regulations will apply to all existing tenancies as well as new agreements and landlords are being urged to be ready to ensure their rental properties comply.

Changes to EPC regulations are part of a government led initiative targeting energy inefficient housing in England and Wales in a wider strategy to tackle climate change.

It is estimated that around 7% of properties in the private rented sector currently hold the lowest EPC ratings according to the Energy Saving Trust.

Vickers & Barrass says there are possible grounds for an exemption including cost.

If after implementing improvements costing £3,500 including VAT and the property is still unable to achieve a target EPC rating of E or better a landlord can register for an exemption on the Private Rented Sector (PRS) Exemption Register.

While welcoming an initiative designed to raise standards, Vickers & Barrass fears that many local landlords may decide not to implement the required improvements and instead sell their properties, reducing further the options for hard pressed tenants searching for accommodation.

Edd Forster, sales manager at Vickers & Barrass, said: “New regulations are always a question of balance for landlords, who have faced continued change and increasing costs over the last few years.

“We could see more landlords exit the market in the months ahead, leading to a lack of suitable rental accommodation at a time when there is a desperate shortage of stock to let.

“They may look to evict tenants where the property falls below the minimum requirement of an E, so they can implement improvements or make the decision to sell.”

With only a few weeks until the changes take effect, landlords whose properties are currently F or G EPC rated need to start planning improvements now to make sure they are ready for the deadline, Edd Forster advised.

“Landlords should check the recommendations in the EPC and obtain quotations for the suggested works. It may be worth instructing an assessor to undertake a new EPC assessment if improvements have been undertaken or it is considered the previous assessment was not correct.

“Assessment techniques have improved and may produce a more accurate rating which is above the minimum standard.”

The news comes as Vickers & Barrass reports a very strong lettings market – it continues to seek more properties to meet demand: “As always we will be monitoring the sales and lettings market over the coming weeks, while continuing to support and advise landlords and vendors,” Edd Forster added.

“Landlords should check the recommendations in the EPC and obtain quotations for the suggested works.”

Posted by Vickers & Barrass on March 5th, 2020

Sales & Lettings

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Vickers & Barrass

Rural Chartered Surveyors offering professional land agency services in the North East.