How will the new EPC legislation effect me as a Landlord?

Q.  I recently heard that there is going to be some new government legislation surrounding EPC’s sometime soon which could affect Landlords like myself with respect to their rental portfolios. I am not absolutely clear on how this will impact me and what I need to do to ensure I am compliant, can you assist?

A.  The Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 mean that as of April 1st, 2018 any private sector rental properties will be required to have an Energy Performance Certificate (EPC) with a rating of E or higher. This will apply to new lets and renewed tenancies from April 2018 and will then be applied to existing tenancies from April 2020. After those dates it will be unlawful to rent a property without a rating of E (excluding some specified exemptions). Landlords found to be in breach of these regulations face civil penalty fine that could be as much as £5,000, so the implications are serious and not something to be taken lightly. The new regulations apply to private, domestic rented properties that are let under an assured shorthold tenancy. The properties affected are any domestic, privately rented properties which are already required by law to have an EPC or is contained within a larger unit which is required to have one. This includes houses, flats and self-contained units but isn’t applicable to bedsits. It is also good to remember that an EPC cannot be more than 10 years old and would have to be renewed at that point. Currently there are no regulations relating to how the energy efficiency rating E is achieved so it is up to individual landlord to decide what work is carried out on the property to improve the rating. The regulations stipulate that only cost-effective improvements should be made and it’s possible that a landlord could be exempt in some cases. For example, if a landlord can prove that they’ve taken all possible cost-effective measures to make improvements, but the rating still remains below E. Or, in some cases, the landlord may be unable to obtain consent for the works from the occupying tenant. The regulations will be enforced by the local authority who will serve landlords with compliance notices to confirm properties either meet the required standards or have been declared as exempt. If they find a landlord has not complied with either they are able to issue a penalty fine which could be up to £5,000. A landlord can request a review of a penalty notice followed by an appeals process if they are still not satisfied with the local authority’s decision. So, check your ratings to remain on the right side of the law.