EPC Regulations for Landlords
Energy Performance Certificates (EPCs) are assessments completed by surveyors to measure the energy efficiency of a property on a scale of A-G, where “A” is highly efficient and “G” is inefficient (similar to the energy performance scale you see when purchasing electronic appliances such as TVs or washing machines). A more efficient property will benefit from a lower carbon footprint and smaller energy bills.
EPCs were first introduced in 2007, and are legally required when selling or letting a property. Once acquired, an EPC certificate is valid for ten years and can be used across multiple sales or tenancies of the property. The certificate will highlight the property’s current efficiency rating, as well as its maximum potential and the suggested steps that can be taken to improve upon the current rating. The average EPC rating for a property in the UK is around band D-E.
Incoming changes to landlord legislation.
Currently, a property must have an energy efficiency rating of “E” or above for it to be legally rented to tenants. These minimum energy efficiency standards were introduced by the government to improve the quality and increase the energy efficiency of the worst-performing privately rented houses and buildings.
Although the incoming regulation amendments are not yet clarified and set in stone, it is expected that from 2025 properties will be required to hold an EPC rating of at least “C” or above for new tenancies. Then from 2028, this same rule will apply to all tenancies (not just new ones). If a property doesn’t meet this rating, then it will not be legal to rent it out as private housing. There are exemptions to the rule, for example if recommended efficiency improvements would damage the fabric of a building or if the building is listed or officially protected and the minimum energy performance requirements would unacceptably alter it. Additionally, there is a high-cost exemption, which is applicable when the cheapest recommended improvement would exceed £3,500.
While this change is at least 3 years away for most landlords, if not up to 6, now is the time to start thinking about ensuring your rental property will be compliant in time. Typical improvements that can be made range from minor investments such as implementing lower energy lighting, to major upgrades such as upgrading the boiler or installing double glazing. With the potential for these costs to approach 5 figures for the most inefficient homes, now would be good to start saving.
Energy efficiency grants.
The good news is that there is help available to homeowners in order to ease the burden of costs in improving the energy efficiency standards of the nation. This includes funding in the form of grants for boiler upgrades. More information on how the government is offering assistance can be found on the following link: https://www.gov.uk/government/collections/find-energy-grants-for-you-home-help-to-heat
With these upcoming legislative changes, alongside the UK’s currently sharply rising energy bills, any and all possible savings are welcome.
