The environmental impact of homes is now a key focus for the Government as they seek to meet their obligations under the Kyoto Protocol and the Paris Agreement.
The Energy Efficiency Regulations, which came into effect in 2018, established a minimum level of energy efficiency for privately rented property in England and Wales.
This means that, from April 2018, rented properties must have a minimum Energy Performance Certificate (EPC) efficiency rating of E before a new tenancy can be granted to new or existing tenants. Energy Performance Certificate efficiency ratings range from A (most efficient) to G (least efficient) and are valid for 10 years. Landlords who were already renting out properties with an EPC rating of less than E when the new legislation came into effect have until 1st April 2020 to make improvements to their properties and bring them up to the minimum standards required.
Letting agents need to ensure that their landlords are aware of these changes and what their obligations are under the legislation. These include:
• Landlords will need to spend up to £3,500 towards improving rental properties that have an F or G rating to bring them in line with the minimum energy efficiency standards, which must have a minimum of an E rating from 1st April 2020.
• Landlords can choose which improvements they make, according to the guidance, as long as they are confident that those improvements will bring their property to a minimum E rating. Improvements could include insulating the loft, roof or walls; upgrading the boiler; or installing low-energy lighting.
• If they make improvements which are not “relevant energy efficiency improvements”, and the property is still below an E rating, they’ll need to make further improvements.
• A landlord who has made all the “relevant energy efficiency improvements” but whose property is still below E, will need to apply for an exemption.
Landlords could be liable for fines of up to £4,000 and, if the property still isn’t up to standard after three months, they could be fined up to 20% of the property’s rateable value.