Warning to all Landlords – time is running out!

Landlords will not be able to rent out both domestic and non-domestic properties unless they meet the new Energy Performance Certificate (EPC) Rules (2018) which come into force on 1 April 2018.  Properties across England and Wales are currently expected not to pass the new rules and could face huge fines.

To make sure you don’t fall foul, consider the new rules and what you need to do to make your property compliant in time.

What are the upcoming EPC changes?

Landlords are required to have a EPC Certificate and they last for a period of ten years.  Back in 2015 legislation was passed that means, from 1 April 2018, properties will have to meet a minimum energy efficiency standard (MEES).  The minimum efficiency standard is set at an E rating for all types of domestic and non-domestic property.

So which properties do the new EPC rules apply to?

The new rules apply to both domestic and none-domestic properties in the private rental sector meaning that whether a landlord is letting out a commercial property or a house to a tenant, it could be unlawful to do so should the building not meet these new minimum EPC requirements.

Without an EPC rated E or above it will not be possible to issue a new tenancy, or renew an existing tenancy, from 1st April 2018.  There are fines of up to £5,000 for landlords that are found in breach of the legislation.  The regulations will be enforced by Trading Standards Officers. Penalties will be based on the rateable value of the property.

Do the EPC changes affect current tenancies or just new lets?

The 2018 rules only apply to new tenancies, but in 2020, the same rules will apply to all tenancies.

In April 2020, the new MEES rules will apply to all existing lets.  At this point, you will need an EPC rating of an E or above to let your property at all.  Even if your tenancy is already underway and you have no plans to renew, after April 2020, you will need to have an EPC rating of E or above or you could face fines.

What should I do if my rental property has an EPC that is lower than an E rating?

If your last EPC rating was below an E, the first thing to do is consider when the EPC was last carried our and what improvements, if any, you have made to the property that may have improved the energy efficiency rating.  EPC calculations are changing all the time and it is possible that you will receive a different rating to the one you got several years ago.  Your EPC report will have a list of recommended measures for improving your property’s energy efficiency performance.  You will need to carry out enough of these measures to improve your score to above an E rating.  If the property’s new EPC rating is still below an E, then you will need to make efficiency improvements to boost your rating before you let it out or renew your contract.

Speak to your EPC assessor if you are unsure about how to proceed with improvements.  After the energy efficiency changes have been made to the property, you will then need to get another EPC to show the new energy rating.

We recommend you review your property portfolio now to consider what you may need to budget for in the future.

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