EPC exemption for stand alone buildings under 50sq/m?

EPC exemption for stand alone buildings under 50sq/m?

15:11 PM, 19th December 2022, About 2 years ago 13

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For over 30 years now, I’ve rented out a small detached property, 30sq/m according to the EPC, which used to be the bakehouse (large oven still in situ) and washhouse for 3 cottages in front of it. The original outside toilet is still in place for summertime use, and it has large garden tenants can use, and everybody who has lived there, including the present tenant, has loved it, especially the fact that it’s hidden away and quiet, such that even some locals don’t know it’s there!

However, this EPC situation is about to hit us Landlords is critical as to whether it can remain as a rental property or not. I’ve read over the last couple of years, that stand-alone buildings, with under 50sq/m useable floor area are exempt, and many websites state this to be the case, but others say it is only applicable to commercial premises.

I’ve tried previously to register it as exempt with the Government department responsible (forget which), but they say that this is only applicable to commercial properties, and not residential ones.

Does anybody know exactly what the situation is please, or have any experience with this situation?

This will determine my future plan of action.

Martin

Editor’s Note: Government Department for Business Energy & Industrial Strategy

Guidance on PRS exemptions and Exemptions Register evidence requirement

https://www.gov.uk/government/publications/private-rented-sector-minimum-energy-efficiency-standard-exemptions/guidance-on-prs-exemptions-and-exemptions-register-evidence-requirements


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Tom Pope - Energy Report Ltd

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10:55 AM, 20th December 2022, About 2 years ago

I’m a commercial EPC assessor and run a business doing EPCs. My understanding is that this exemption is only applicable to commercial property.

Jerry stone

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11:47 AM, 20th December 2022, About 2 years ago

Nothing to do with EPC's but this would fail the minimum room sizes.
https://www.planninggeek.co.uk/planning/space-standards/dwellings/

Dennis Forrest

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15:04 PM, 20th December 2022, About 2 years ago

Reply to the comment left by Jerry stone at 20/12/2022 - 11:47Do minimum room sizes apply to holiday lets? I don't think so. If I am correct then providing the poster is fairly confident he can let it out for a minimum of 105 days each year then this may be a good way out to avoid council tax, get a reasonable income and pay zero business rates as well.

Dennis Forrest

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15:17 PM, 20th December 2022, About 2 years ago

At the moment there is no legislation pending that holiday homes must have a minimum 'C ' EPC rating. This makes sense as the guests never or rarely pay any of the fuel bills.

Simon F

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21:21 PM, 20th December 2022, About 2 years ago

Maybe consider getting it listed...
"An EPC is not currently required for a listed property or building within a conservation area when it is sold or rented in so far as compliance with minimum energy performance requirements would unacceptably alter its character or appearance."

Martin S

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11:03 AM, 21st December 2022, About 2 years ago

Thanks for the comments so far, but nothing definitive yet it seems.

Interesting someone mentions space standards, as neither I, nor tenants have ever really thought about that aspect before.

It has a reasonable sized bedroom/living room on the 1st floor, and kitchen & bathroom with shower downstairs. Who would enforce this?

As for having it listed, this can't happen just because someone would like it to happen, and would be something of a poisoned chalice anyway. Plus, it's not in a conservation area, although being very near Ironbridge, Shropshire, there is a holiday let demand, and so that is a possibility, although living 120 miles away makes things more difficult.

One possibility is to strip the place out, and have it as a workshop again, as it was when we bought it in the mid 80's. Maybe office space? There is a possibility of selling it, with some adjacant land, so that it could be developed, but the amount of GCT would be very high, and rather than let the Government fleece me, I would rather it sit there as an empty shell!

Coincidentally, this year I've bought an old (1650) cottage in my home town, for doing holiday lets, which is in a conservation area, and everything around it is listed. Having been to the county archives, and met the historic buildings people, there is a file on the property, but they can't understand how it has slipped through the listings net over the years, and said that I could have it listed if I wished. No thanks!

As I understand it, listed buildings can be EPC exempt, but being in a conservation area by itself doesn't exempt a property.

As for Council Tax, I understand that you can have one property in the UK as exempt, but any 2nd, or further properties can’t be. How one would know about the other 120 miles away, I don’t know.

I also have one of the cottages in front of this small house, and they have always housed single people, mainly men, whose relationship has broken down. As a rule, they stay for a minimum of 4 years, until they get their lives back together, find someone else, and move to a bigger property with a new partner.

The local Council have an increasing problem with homelesness, and say that part of the problem is the lack of 1 bed properties. As things stand, there will be two such properties less in 2015, which is crazy, as I'm happy, and the tenants are happy, and so where is the logic?

Martin S

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11:15 AM, 21st December 2022, About 2 years ago

That should have read 2025, and not 2015!

Dennis Forrest

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13:40 PM, 21st December 2022, About 2 years ago

Reply to the comment left by Martin S at 21/12/2022 - 11:03Our holiday let is in Ludow, also in Shropshire, and I live 150 miles away and do not find it too much of a problem. I use a local cleaning company which also arrange laundry, and they do changeovers as and when needed. We also pay a neighbour who really enjoys gardening to keep our garden neat and tidy. For the last few years, (Covid has helped), we have averaged over 200 nights let per annum. We stay there ourselves 3 or 4 times a year. We need to be around for Landlords Gas Check and also to catch up on any jobs missed by cleaners (e.g. cleaning extractor fans or changing cooker hood filters). We call it a working holiday but usually the work part is less than 50%. You will be aware of all the tax benefits of a holiday let without me telling you.

Martin S

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17:26 PM, 21st December 2022, About 2 years ago

Thanks for that feedback. It's a distinct possibility. Worth it financially when all the costs are taken out?

Dennis Forrest

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19:19 PM, 21st December 2022, About 2 years ago

The following figures are NET profits after all expenses like changeover fees, gas check and running repairs, gas, electric and water bills, letting agents/Airbnb commissions etc. Tax year 20-21 £22,000: Tax year 21-22 £22,150: Tax year 22-23 estimated as not yet completed £11,000. N.B tax year 20-21 and 21-22 were boosted by government Covid hospitality grants. You had to be registered for business rates to get those grants. Although I get a few families most of my guest are retired or semi-retired couples, and I would expect you would get similar guests at Ironbridge. I get very little damages or breakages. I have been going 5 years now and had many guests comes back for a second time and a few three times. If you have the space make sure you get at least a 5 feet King size bed - a 4'6" bed is too small. You could do well in Ironbridge - besides Ironbridge itself you have attractive places like Much Wenlock only a few miles away

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