11:08 AM, 30th March 2023, About 2 years ago 27
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Landlords will have five years to reach planned EPC targets for ALL rented homes, and the new cap on costs will be £10,000, a newspaper reveals.
The Telegraph says the government will announce the new deadline after responding to fears that landlords do not have time to meet the proposed 1 April 2025 target.
And they have been warned by various landlord organisations that landlords facing a big bill will decide to sell up and leave the private rented sector (PRS).
Under the government’s original proposal, all new lets from April 2025 would need to meet a minimum EPC rating of C, while all other tenancies would have to comply by 2028.
However, the Telegraph reports that failing to meet the proposed new 2028 deadline for EPC compliance will see landlords facing a fine of up to £30,000.
The move could see up to two million landlords having to boost their property’s EPC rating to help the UK reduce its carbon footprint.
In England and Wales, currently, a private rented home must have a minimum energy performance of E before being let.
One of the big issues facing for pushing the deadline back is that around 3,500 rented properties would have to be upgraded every day for the PRS to meet the 2025 deadline.
Now, the government has apparently been working with lenders on its EPC proposals which could see the cap on the maximum spend on each property being set at £10,000.
That amount will be regardless of whether the C rating is achieved or not, the Telegraph reports.
Rodney Townson, of the landlords’ organisation iHowz, told Properyt118: “If this report turns out to be true, the delay would be a welcome acknowledgement of the lost time caused by dither and delay since the consultation on EPCs.
“Implementation remains dependent on the publication of the new EPC SAP – which would define the balance between cost, payback period and carbon emissions – not just a higher MEES.”
He added: “We encourage the government to publish the new EPC and MEES requirements at the earliest possible date, together with a meaningful long term funding package to support their stated ‘fabric first’ insulation and retrofit approach to homes.”
Goodlord’s head of tenancy services, Rik Smith, said: “I’m sure the market will welcome the proposed extended deadline to get properties up to standard, but there’s an enormous amount to do before then.”
He added: “The energy efficiency task force has only just been assembled, so they will need to get up to speed extremely quickly if landlords are to be supported in this transition, and the EPC methodology also needs a significant overhaul to ensure it’s accurate and fit for purpose if it’s to be used as such a fundamental lynchpin in our housing strategy.
“Landlords across the market are already feeling pressure on many fronts, including rising mortgage rates, so we don’t want a lack of required infrastructure or not fit-for-purpose guidelines to lead them into leaving the sector.”
Tom Goodman, the managing director at Vouch, said: “With all market regulation, it’s vital to balance long- and short-term considerations.
“The last thing the sector needs is another push factor encouraging landlords to sell-up – there is already too tight a squeeze on rental stock.
“What we need now is a balanced and supportive approach from the Government on next steps, so that landlords are incentivised to make these upgrades and can afford them.”
A government spokesman says it has carried out a consultation on energy performance targets and is set to publish its official response ‘in due course’.
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Jireh Homes
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Sign Up10:53 AM, 1st April 2023, About 2 years ago
The software behind RdSAP which is used to produce the EPC is due to be revised later this year so is likely to change the computed SAP score. This may penalise electric heating less but other changes unknown, so perhaps obtain an EPC now based on current conventions and then one after the update but hold on lodging the later if turns out poorer.
Jireh Homes
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Sign Up11:00 AM, 1st April 2023, About 2 years ago
Reply to the comment left by JB at 31/03/2023 - 11:59
MEES is Minimum Energy Efficiency Standards, which is proposed to be Band C by 2028 on all rental properties (in England & Wales, as Scotland still to declare if this will be Band C starting 2025). Properties below the minimum rating may apply for Exemption, which is likely to be the approach by many as alternative to selling up.
Luke P
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Sign Up11:34 AM, 1st April 2023, About 2 years ago
Reply to the comment left by Tim Rogers at 31/03/2023 - 10:53
You’ll need to sell by 2025 as the value will plummet (once the cat’s officially out the bag). Every investor planning on staying will be the only ones buying, looking to hoover up bargains from trapped LLs. Watch for future stories of buyers having a friendly assessor that they split the purchase price discount with in exchange for bumping up their bargain band E house to a C…
JB
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Sign Up21:24 PM, 2nd April 2023, About 2 years ago
Reply to the comment left by Jireh Homes at 01/04/2023 - 11:00
Thanks Jireh.
We're all working in the dark not really knowing what target we're trying to hit, but I decided to re-do my EPC's as I was looking at remortgaging and also to get them done before stricter assessments were introduced. Some original 'C's came out as 'D's so I asked the assessor not to register those.
I am hoping that those I've recently registered with a C will be valid for the next 10 years. Is it possible that we could be made to have them done again to a strictor standard before the 10 years are up?
Crouchender
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Sign Up8:44 AM, 3rd April 2023, About 2 years ago
Reply to the comment left by JB at 02/04/2023 - 21:24
I can't see why we would have to do them before 10 years. If its a C now its helps the government figures. They certainly don't want to massage the figures downwards as it is not good optics.
Its a numbers game for the government on EPCs. Labour may have a different hardline stance on LLs/ EPCs!!!!
JB
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Sign Up9:20 AM, 3rd April 2023, About 2 years ago
Reply to the comment left by Crouchender at 03/04/2023 - 08:44
So rather than wait until your EPC runs out and new algorithms, which may be less favourable are introduced, it may be a good idea to have properties reassessed now to secure a 'C' for the next 10 years.
Crouchender
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Sign Up10:08 AM, 3rd April 2023, About 2 years ago
Reply to the comment left by JB at 03/04/2023 - 09:20
Absolutely as I have done this last year so I have 9 years protection to rent left.
GlanACC
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Sign Up17:25 PM, 6th April 2023, About 2 years ago
You could get an exemption if the tenant writes you a letter and refuses access to the property to perform the upgrade. This is perfectly legitimate and an exemption has to be issued. Your only choice then would be to ask the tenant to leave but you don't have to do this
Reluctant Landlord
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Sign Up11:01 AM, 7th April 2023, About 2 years ago
Reply to the comment left by Derek STOBBS at 06/04/2023 - 17:25
exactly what I plan to do. If you explain that any works would not only be potentially disruptive, but as a direct result cause a rent increase, then tenants will be clamering for a pen...
Alternatively the exemption rules do state that if you cant get agreement from the freeholder/property owner then this is another route for exemption. So if the property is jointly owned for example by two people, all it would take is one to state they do not give permission for any works to be undertaken on their property.
Play them at their own game!
Rickie Dickson
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Sign Up10:35 AM, 7th May 2023, About 2 years ago
Reply to the comment left by Jireh Homes at 01/04/2023 - 10:53A word of warning, the rdSAP update you mentioned due at the end of the year, will actually rate electric heated properties lower than they are now, so an electric heated property with a current EPC with rating of a C80 will become a D67. Yes a massive 13 point reduction in the Sap rating. So landlords, don't think that the EPC you had done 10 years ago is going to come back with the same rating when updated an the end of this year.
I am a qualified Domestic Energy Assessor doing assessments under rdSAP for existing properties and full SAP for new builds. The changes have already been implemented for full SAP with rdSAP to follow soon. What's happened is the cost factor for the different types of fuels are being updated for the first time since EPCs were introduced. So what's happened is because a greater percentage of the electricity we use comes from renewable sources, the CO2 ratings on the EPC have significantly improved, however, the unit cost of electricity has significantly increased compared to other fuel types.
Don't think that a low carbon home is a low running cost home. They are 2 total different metrics calculated by the EPC. Because the EPC rating is based on running costs not carbon, the EPC rating of electrically heated homes will be lower. Gas heated homes are likely to stay the same and Oil & LPG homes will see a slight increase in their EPC ratings.
So although there is a drive by Government towards electric heating, the EPC rating system doesn't align with their policy.