New regulations for private landlords mean you could be in for a hefty fine if the property you rent out has an EPC rating of E or lower. But more than that you may be prevented from renting out the property at all, until improvements are made.
EPCs and the law
It is a legal requirement for all rented homes in the UK to have a valid EPC certificate. These must be renewed every 10 years. An EPC survey measures the energy efficiency and typical energy use of your property, giving it a rating from A (most efficient) to G ( least efficient). It then gives suggestions of how to improve your rating, such as installing measures like loft insulation.
From 1st April 2018, a change of legislation means that any properties rented out in the private sector must have a minimum energy rating of E on their Energy Performance Certificate. The regulations will come into force for new lets and renewals of tenancies with effect from 1st April 2018 and for all existing tenancies on 1st April 2020. It will be illegal to rent a property which breaches the requirement for a minimum E rating, unless there is an applicable exemption. If there is a breach in this legislation and the property has a low EPC rating then the landlord could have to pay a £4000 fine.
The reason for these rules is that an energy inefficient property is considered ‘substandard’ accommodation, as it places higher heating costs on the tenant. It is the landlord’s responsibility to ensure their tenants are comfortable and are not paying over the odds on their energy bills. The stepped nature of these changes means that if you are a standing tenant or don’t require a renewal of the contract – then there will be no obligation to improve the energy efficiency before 2020. Existing tenancies will be part of the legislation from April 2020, so at this point every rented property in the UK will need to be brought up to an E rating or higher.
So although these changes are a year away from being implemented, there is no harm in getting ahead – why not book your property in for an EPC now? It is well worth spending the minimal amount an EPC costs and avoiding a potentially hefty fine further down the line. Prices start at around £35, although it varies greatly depending on where you are, as well as the size and complexity of the building.
Plus, if you find that your property is not up to standard, then it gives you enough time to take remedial action. If you leave it until the last minute, then it could be a mad rush to get the property up to scratch, or risk losing out on valuable rental income whilst works are carried out.
How do you get your low EPC rating up to an E?
Most properties in the UK are at least an E rating. The UK average is a D. Having said that, there are still many properties with very poor ratings. It is relatively simple for most homes to reach an E rating. Just some simple loft insulation, efficient lighting and draught proofing will help immensely. There will of course be some properties where an E is very difficult to achieve, and with these, there may be significant costs involved in doing so. In this instance, it might be better to sell the property all together, but you won’t know until an EPC has been carried out.