Homes with EPCs rating ‘E' or less cannot be rented from April 2018!

publication date: May 13, 2011
author/source: Kate Faulkner, Property Expert and Author of Which? Property Books

Energy Performance Certificate Regulations

Homes with EPCs rating ‘E' or less cannot be rented from April 2018!

Chris Huhne, Energy and Climate Change Secretary has announced a second reading of the latest Energy Bill which states "From April 2016 landlords will not be able to refuse reasonable requests from tenants, or local authorities acting on behalf of tenants, to improve their property" and "From April 2018 the government will make it unlawful to rent out a house or business premise which has less than an "E" energy efficiency rating".

Kate Faulkner, MD of the independent property advice site Designs on Property says "This will cause a major problem for many landlords over the next few years as the most ‘popular' buy to let property of choice over the last 15 years has typically been two bed Victorian terraces, which are obviously not great from an energy performance perspective." Kate, who works with the property industry, tenants and landlords says "from the tenants' perspective there is a benefit in that they will be able to request improvements through this Bill, but as tenants only tend to stay for up to 18 months and energy efficiency loans will last on the property for some years, the issue is, will the next set of tenants want to continue paying for these improvements through higher energy bills?".

To help these improvements, The Green Deal is the coalition's national plan of home improvements to make houses cheaper to run through better energy efficiency. From 2012, people will be able to access finance to pay for the upfront cost of work which will be paid back through savings on lower fuel bills. According to Chris Huhne, "The Green Deal is a win-win opportunity for landlords by removing the upfront cost of work to upgrade the property making it cheaper to run, more environmentally friendly and ultimately more attractive to rent" and "The proposals will help the most vulnerable as more than a quarter of a million of the worst insulated rented homes are classed as fuel poor."

According to Christopher Huhne, "at least 682,000 properties will have to be improved" and Kate believes that the majority of these repairs will end up being paid for by landlords. "Landlords aren't the people they were 20 years ago" says Kate "most are mums and dads who have invested some of their hard earned cash into properties they can rent out to help boost their pensions, retire a few years earlier or make sure they can set their kids up in a home". As a result they tend to provide great homes for people who don't want to save up and buy their own home, or have the hassle of owning one and paying out for repairs. Kate says "Most landlords today offer a real alternative home ownership which hasn't existed before." She believes though that these changes, coupled with a lack of capital growth in many areas across the UK at the moment, and possible 5% plus mortgage interest payments, may mean owning and letting a property for many "becomes too much of a hassle and burden".


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