- If you are a landlord, you need to be aware of recently announced changes to regulations relating to EPC’s in rented property. As from the 1st April 2018, both commercial and residential EPCs will be required to meet a minimum rating of E. However, if there is a tenant in the property with a continuing tenancy up to the 1st April 2023, the existing EPC may remain until this date. After this date, landlords with an EPC rating of lower than E are required to improve their EPC rating regardless of continuing a tenancy already in place. Additionally, if a valid EPC is less than ten years old when a property is purchased, a new one is not necessary unless the property is let or sold. Landlords who are starting a new tenancy or extending their current tenancy after the 1st April 2018 must ensure that met the new requirements set out on the new regulations. Any exemptions for band F and G properties must be registered on the PRS Exemptions Register.
Exemptions may be applied if:
- The landlord has carried out all the relevant energy efficiency improvements (review again after 5 years).
- The tenant or any third party denies the landlord consent to carry out energy efficiency improvements (may apply for a 5-year exemption).
- An independent surveyor has informed the landlord that energy efficiency improvements would result in a reduction of more than 5% in market value.
- A person has recently become the owner of a property which is already subject to a lease (may apply for a temporary exemption for 6 months).
The SAP assessment methodology is also currently under review following the consultation on SAP 2016. It is probable that there will be significant changes to the treatment of chimneys, carbon factors and the u-value of solid brick walls. However, such changes are unlikely to be released until late 2018.