Energy performance certificates
In order for homes to be legally sold or rented in the UK, they must have an energy performance certificate, often referred to as an EPC. Residential landlords are subject to the minimum energy efficiency standards (MEES) which came into force in April 2018. At present, all rented properties required an EPC rating of ‘E’ or above.
EPC’s are valid for ten years and provide ratings to properties which measures their energy efficiency on a scale from A-G. “A” rated homes are considered the most efficient and “G” rated homes the least. The process for obtaining an EPC is simple and includes a report suggesting changes which can be made to improve future EPC ratings on the property.
The UK Government aims to lead the Green Industrial Revolution and has a net zero emission target by 2050. As part of the Government plan to reach this goal, changes in rules regarding EPC’s have been introduced using a two phase plan.
In the current phase 1, it is now a requirement for all new tenancies starting from 2025 to have an EPC rating within Band C or above. For tenancies already in existence, the new regulations will not come into force until 2028. Phase 2 will require landlords to present a valid EPC of B or above by 1 April 2028. A rating of less than B will require landlords to undertake the necessary works to increase the rating to B or have a registered valid exemption by 1 April 2030.
As the rules stand, there is a maximum cost cap of £3,500 per property. If a property does not meet the minimum EPC requirements after spending this sum, it is possible to register an exemption. Exemptions are also available in circumstances where work would damage or devalue the building or landlords are unable to obtain third party consent for necessary changes to be made. A temporary 6-month exemption is also granted for new landlords. It must be noted that the present exemptions can be subject to change and best endeavours should be made by landlords to ensure where possible, the EPC regulations are complied with. MEES are here to stay and are only becoming more rigorous.
A number of measures can be taken in order to improve energy performance ratings, by acting sooner rather than later landlords are able to spread the cost over a longer period of time and avoid large last minute bills, whilst beating the rush to secure supplies and book tradesmen.
Property owners must first consider the possibility for changes be made to property they already own. The age and status of a property needs to be considered, existing leases should be reviewed for any restrictions and hurdles that may be faced, and landlords should also research how and if costs can be shared between landlord and tenants to ease the burden.
It may seem as though EPCs and MEES are only important to landlords. However when buying or selling residential property these are still important considerations that should not be overlooked.
When purchasing a new property, a quick inspection of the certificate will provide an indication of how energy efficient the home is, enabling you to forecast costs for running the house as well as what it may cost to fix any inefficiencies.
A poor rating can also affect the ability to sell homes in the future. Money saved by not investing into improving the rating may be inconsequential if potential buyers are not willing to pay “market rate” for properties that to not meet “market standards”. Energy prices are soaring and most buyers will look for high performance homes in terms of energy efficiency. Once again by beating the rush and spreading the costs, the value of your property
Our Property team at Sintons can assist you in identifying the best solution for your properties and are able to facilitate a host of solutions according to your needs. Whether you are a landlord with an extensive property portfolio or looking to buy or sell your family home, we can help.
Suzanne Dixon is a Senior Associate in the residential conveyancing department at Sintons. To speak to Suzanne, please contact her at suzanne.dixon@sintons.co.uk or 0191 226 7805.
