The Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 came in to effect on 1 April 2018, requiring all newly let residential properties to have an Energy Performance rating of E or above, and going forwards, all let properties to be compliant by 1 April 2020. It is the landlord’s responsibility to ensure that their property is up to standard before it is advertised to be let.
Since the collapse of the Green Deal, it has been considered that there is a reduced incentive for landlords to carry out works to their properties. The government recently consulted on the above regulations, the outcome of which proposes some alterations to the current exemptions list and landlord requirements to get their property’s up to standard. The proposed changes are likely to come into effect in 2019.
Currently, landlords can apply for an exemption for the following reasons:
- No grant funding available;
- 7-year payback (if saving made on energy bills does not equate to the money that would need to be spent on upgrading the property);
- All EPC improvements already having been made;
- Wall insulation not suitable for the property;
- Lack of tenants’ consent;
- Works will devalue the property;
- Temporary exemption if you are a new landlord.
The main changes that have been proposed through the consultation are as follows:
- Increase in landlord payment cap to £3,500, from £2,500;
- Removal of some exemptions, such as tenants’ refusal to works and the ‘no funding’ exemption for landlord;
- Introduction of a ‘high cost’ exemption for landlords if costs are to be over £3,500 (these costs should include VAT, any investment since Oct 2017 and third-party grant funding).
Please note that the above proposals are likely to be introduced next year but legislation has not yet been updated and there is no firm date for landlords to be aware of at this stage.
Landlords must be aware that if their tenancy becomes a periodic tenancy after 1 April 2018 then this is regarded as a new tenancy and the property must abide by the MEES regulations.
If you have any queries, or wish to discuss any of the above in more detail, please contact Hennie Hargreaves in our Rural Management Team on 01285 883751 or firstname.lastname@example.org