Approximately 10% of landlords in England and Wales currently let homes that they will be banned from letting without upgrades starting 1st April, 2018. As part of the government’s scheme to reduce the environmental footprint of the nation, all landlords are required to obtain an Energy Performance Certificate or EPC for homes that they let.
In order to get the certificate landlords must put the property through an inspection where it will be graded from ‘A’ to ‘G’. Rental units rated ‘F’ or ‘G’ will be required to upgrade to at least an ‘E’ level in order to continue letting the property after 1st April. Those who do not comply with the regulations and obtain the certificate and do the upgrades can face fines and prosecution.
For tenants the new regulations are a boon. It is estimated around 10% of units for let in England and Wales will not meet the minimum ‘E’ standard. These draughty old energy-inefficient homes currently cost tenants a pretty penny to heat and cool, with an average savings to tenants of £1000 expected.
Tenants may also request their landlord to upgrade the energy efficiency of the premises. Unlike the status quo, starting April 2016 landlords will be required to comply with the tenant request for the energy efficiency upgrades. Failure to do so can lead to fines.
Housing in England is Old
The housing stock in England and Wales is some of the oldest in all of Europe. With many of the properties with units for let being from Edwardian and Victorian times, they often do not have the benefit of insulation. This means that these homes leak heat in the winter and are difficult to cool in summer. Overall the scheme will be one of the largest upgrades of the housing stock in England and Wales since the end of the Second World War.
For landlords the scheme is not all bad news. There are several funds that landlords can apply to in order to obtain tax breaks, credits, and cash to pay for property upgrades. The first such upgrade must be claimed before 6th April of this year, a landlord can claim £1500 spent on energy efficiency on a rental property against income. Similarly the Green Deal program will lend up to $5,600, paid back by tenants energy bills, to make improvements to the unit. Also until the 31st May, landlords can apply to the ECO or Energy Companies Obligation fund for a grant towards their improvements.
Governing Coalition Deadlocked over Regulations
Ed Davey the Climate and Energy Secretary who brought in the regulations has fought hard to see to their implementation. He recently stated he wished the regulations could have been brought in earlier noting, “Not everyone in this government wants more regulation. But in energy efficiency, regulations play a crucial role.”
Davey also highlighted the benefits to tenants, many of whom struggle financially. Noting the fact that the savings from the energy efficiency initiative would help alleviate poverty, and stating, “We’re talking the deepest fuel poverty, and we’re going after it hard, because it’s frankly unacceptable in this day and age.”
