9:36 AM, 2nd August 2024, About 3 months ago 91
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Here we go again with energy performance certificate (EPC) ratings needing to be a minimum of C for the private rented sector but not homeowners, social housing or government buildings.
Ed Miliband was rather slovenly when sprawling over the despatch box to tell MPs that landlords will have a deadline of 2030 to meet. That’s a deadline after Labour gets voted out of office.
The big worry for me is that the EPC move will be riding on the coattails of a new Renters’ Rights Bill which will undermine and scare many landlords.
I’m also concerned that the people making the decisions don’t understand energy performance certificates.
If they did, they’d know they aren’t worth the paper they are printed on.
I fear though that we will be coerced into going down this route since BTL mortgage lenders offer the carrot of cheaper rates for those who meet the EPC criteria.
However, in all of this, no one ever appears to consider the plight of the tenants.
They will in effect – if Labour don’t bring in a rent cap – be paying for improvements with higher rents.
But what’s the payback for landlords? One year, two years, or more?
That’s a frightening prospect of not making a profit while the tenant enjoys higher rents and (slightly) cheaper fuel bills.
When campaigning, Miliband and Sir Kier said energy bills would drop by £300 a year – but they’ve been quiet on this number lately. And tenants won’t be saving £300 if the rent goes up by £1,500.
But there’s a bigger issue at stake that could put the skids under this plan.
Not only is Labour being shy about the £300 (and Angela Rayner’s vow to ban Section 21 evictions on ‘day one’), but they are also not talking about the energy price cap going up in the autumn and again January. That’s a double whammy hitting pensioners.
We can add that to the already ever-growing list of failed promises for a government that has had the shortest honeymoon period in political history.
I’m pretty sure those pensioners who won’t get the heating allowance will be dancing in the streets as their heating bill rockets.
Let’s face it, most landlords would be happy to improve their property if it was cost-effective and helped increase its value.
But reading Property118 on this issue highlights that the assessors have a lot to answer for by ‘assuming’ a lot of the answers. Usually, wrongly.
Different assessors find different ratings for the same property. Surely, the job can’t be that hard, can it?
Again, politicians of a left bent don’t appear to understand the private rented sector and the implications that come when imposing new rules and laws.
Especially when they cost money.
We are now looking at fed-up landlords who don’t want to upgrade or can’t afford to and have to decide what they should do next.
It also means carrying out the work in a void or putting the tenants up in a hotel. I doubt we’ll be able to evict to get an empty property.
We also need to find someone to do the work.
Good luck with that since all the builders will be busy delivering Angela Rayner’s promised 1.5 million new homes. As if!
It will be a faff organising an assessor, arguing about why it doesn’t reach a C and then being told – hopefully in writing – what needs to be done.
Then you’ll have to spend money on the work and STILL not be guaranteed a C rating.
The whole thing is bonkers.
Ed Miliband will get my support when social housing has to comply with the rules, but no one ever asks why they don’t.
And for those who will wait to see what the law will be, you could be leaving things very late and might get caught out.
Or you could carry out the work for the rule to be dropped Rishi-like when it’s convenient to do so.
This brings me neatly to calculating how many landlords will sell up to avoid the C rating nonsense.
If it takes a few years to recoup the expenses, then why not dish out a section 21 notice to sell the property? [Editor’s note: This sentence has been corrected].
It might be a struggle in front of a judge, but older landlords can say they are selling up to retire and the property is their pension pot.
Younger landlords? Judges might not be so keen if there are lots of landlords doing this though I’d imagine that would be a news story.
What if it is a landlord with a leasehold property and the freeholder declines to carry out improvements?
The more I think of the potential issues, the more I think it’s just easier to bale out altogether.
It’s the lack of joined up thinking by politicians that makes me nervous.
The portrayal of landlords as being greedy and unkind to tenants isn’t going to improve soon.
It will get worse but because the good and kind landlords – that’s most of us, Ed – are already fed up, it needs action from Labour to keep us in the PRS.
To make our point we must either sell up as one body or fight the portrayal of landlords as tenant exploiters.
Politicians can’t dictate how we are portrayed with a caveat they aren’t pointing at all landlords, just the criminal ones.
That isn’t true because you could easily say we are a crucial and respected part of the housing sector. But you don’t.
You could say that landlords should be helped by the government and not victimised. But you don’t.
I’m sure that the sound of landlords marching out of the sector and reducing rented home supply might get your attention.
And if it does, you will portray us as selfish and greedy and leaving tenants homeless.
We can’t win. Things were bad under the Tories but my good goodness, Labour look set to plunge to a new low in playing the blame game.
Until next time,
The Landlord Crusader
Neil Robb
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Sign Up21:42 PM, 3rd August 2024, About 3 months ago
So we have a crisis in housing. Five million families in private homes. How many don't have C ratings .
If global warming is the main reasons why target the 14% of private properties.instead of the other 86%.
I can see many issues ahead. Mostly many properties are going to be over £10 k to try get rating.
In Scotland they are proposing that the limit £13.5 k must be spent to get the exemption. Even if it won't ever get a c rating.
Another proposal was rewrite the way EPC was done . If you have a gas boiler it will be down graded .
The whole system is ridiculous.
In Scotland if you have three properties you don't get help with any improvement grants.
Costs will be met by higher rents.
Finally after years Patrick Harvie admitted heat pumps were dearer to run.
The list is endless. Eight flats in one tenement had £3 million spent on them.
The whole building has a value of only £350 k after all the improvements.
Jim K
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Sign Up11:38 AM, 4th August 2024, About 3 months ago
Reply to the comment left by JaSam at 02/08/2024 - 10:01
Jon.
S8 is for a various conditions.
Rent arrears of 12 months or more is Ground 8 of Section 8.
There are lots of other grounds.
Such as wanting to sell, wanting to move back, major refurbishment.
This would cover the improvements as its going to be difficult yo do much if this work with T in situ.
David Lawrenson
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Sign Up13:20 PM, 4th August 2024, About 3 months ago
Reply to the comment left by Mark Cairns at 02/08/2024 - 10:12
Fair comment.
David Lawrenson
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Sign Up13:30 PM, 4th August 2024, About 3 months ago
Excellent article and informed comments.
Personally, I am surprised that bonkers ukelele playing 'Ed the Ball' Millipede has only stated 2030.
I had expected it to be much earlier than that, so hope springs.
Of course, all the big lenders are natch doing their masters bidding with lower mortgage rates for higher EPC scores.
It is a kind of corporate fascism - with all big corporations getting in on the climateageddon train for fear of being penalised by their own equity and loan funders, if they dare not comply.
And us landlords are the first victims, as all the evidence I see is that under the great reset being played out, the plan is to have housing (especially rented stuff) under the control of big institutional investors who jealously look on at the steady income streams. After all, the returns on government bonds are pretty crap, so to buy some of them, the government has said, "Here, you can have some of this PRS market".
Stella
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Sign Up14:23 PM, 4th August 2024, About 3 months ago
Reply to the comment left by David Lawrenson at 04/08/2024 - 13:30
They are doing their best to get rid of the PRS in favour of the institutions but if Labours additional proposals are implemented and apply to BTR as well as the PRS I think that these institutions might take their investments else where.
It would not surprise me if BTR were subject to more "light touch" rules.
David Lawrenson
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Sign Up14:33 PM, 4th August 2024, About 3 months ago
Reply to the comment left by Stella at 04/08/2024 - 14:23
Yes, v true.
They have got lighter treatment before.
I wrote about it at my blog. They were exempted from landlord licensing in Newham, probably still exempted.
Stella
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Sign Up17:09 PM, 4th August 2024, About 3 months ago
Reply to the comment left by David Lawrenson at 04/08/2024 - 14:33
I have houses in Newham, one is a HMO.
The property in the new E20 postcode (where the foreign investment is) was exempt yet they made the case and were successful for borough wide licensing.
Last time I looked E20 was part of the borough of Newham!
AJR
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Sign Up20:24 PM, 4th August 2024, About 3 months ago
Reply to the comment left by Mark Cairns at 02/08/2024 - 10:12
You are correct the past decade has seen many hostile changes for private landlords, changes which have damaged the PRS as a whole and delivered harsh unintended consequences for tenants.
To say that landlords are ‘whining’ is a naive statement given that the BTL miracle that houses 11 million has the highest tenant satisfaction rates of all forms of rental tenure and is now under real threat. Landlords, many on here, are angry and speaking out and rightly so.
You are deluded if you believe that the hostility driving the vilification of the PRS won’t also affect you.
Beaver
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Sign Up9:56 AM, 5th August 2024, About 3 months ago
Reply to the comment left by Neil Robb at 03/08/2024 - 21:42
You are correct...costs will be met by higher rents.
Whichever way you look at it if this is implemented this will put rents up.
So what's wrong with sorting the EPC system out so that it actually means something and saying that any landlord can let and any tenant can rent any property, including E and F? If the EPC system meant something the E and F properties would just command a lower rent.
What's the point in restricting choice for tenants?
OJ
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Sign Up20:13 PM, 5th August 2024, About 3 months ago
As far as I'm aware social and local authority housing does already have targets of EPC Band C or above by 2030. That is why the PAS 2035 standard for retrofitting dwellings was created. To receive any funding such as the social housing development fund (SHDF) any work carried out must be to PAS 2035. Organisations often use this outside funding to supplement self funding. Maybe the government will come up with something similar for private landlords?
The "assumptions" I think you are talking about are made by the RdSAP software that is used to create the EPC based on parameters entered by the assessor. Because the inspection is non intrusive, so no drilling in the walls to check for insulation, or running any tests. The assumptions will be based on things such as the age of the property and the building regs at the time - unless any evidence such as drawings are available.
As part of PAS 2035 a retrofit survey is required that bridges the gap between an energy survey and a building survey - these surveys are more detailed, can be more intrusive and can involve testing such as background ventiltion tests - the retrofiit survey determines the best work to improve the energy efficiency for that particular property.
There is a problem with #### EPC assessors. That is why it is important to do your due diligence and get somebody professional. People often just go for the cheapest option. Remember it costs fuel to get to and from the job, there is the time on site, the assessor is paying for the lodgement of the EPC, the assessor is paying for the use of the app to collect the data on site, they also have to pay for accreditation and CPD etc. If the EPC is cheap ask yourself how they are able to do it?If you do go with the cheap option, don't complain if the results are ####.