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TODAY'S OTHER NEWS

Agent urges landlords to speak out against expensive EPC rules

Anger continues to mount over government plans to make rental properties more energy efficient, with one agent advising his landlords to make their voices heard on the subject.

Stuart Nash, managing director of Somerset letting agency Stuarts Residential, has suggested his clients tell the government precisely what they think in a formal consultation period now open.

On his website Nash writes: "The Minimum Energy Efficiency Standards were introduced in 2018 requiring all properties to have an EPC rating of no lower than an 'E' and if this isn't the case then it is a breach to grant a tenancy.

"Having navigated our way through this we were rather surprised to see that the Department for Business, Energy and Industrial Strategy announced last week a consultation to increase the minimum standards further to a rating of 'C' by 2025.

"It was widely known that MEES would increase in the coming years but the suggestion was that the benchmarks would be 'D' by 2025 and then 'C' by 2030.

"While recognising the importance of energy efficiency, for landlords there are implications to these measures, particularly in older properties in conservation areas, where achieving these ratings is likely to be difficult. So it is important landlords have their say in these proposals.

"The consultation is open to comment until December 30 and we would strongly recommend that you take their survey so that you can make your views known.”

The government has made clear that while it is officially ‘out to consultation’ it favours one course of action:

- raising the energy performance standard for rental properties to Energy Performance Certificate energy efficiency rating Band C;

- achieving the improvements for new tenancies from 2025 and all tenancies from 2028;

- increasing the maximum investment amount, resulting in an average per-property spend of £4,700 under a £10,000 cap;

- introducing a ‘fabric first’ approach to energy performance improvements (this is improving the performance of the materials that make up the building fabric itself, before considering the use of mechanical systems).

Timothy Douglas, campaigns manager of the Association of Residential Lettings Agents, has already voiced his organisation’s opposition to the proposal.

“On the face of it these proposals simply do not take into account the state of the UK's housing stock. We all want to see more energy efficient homes, but the new rules and requirements must be realistic and achievable” says Douglas. 

“Landlords and their letting agents are already taking the brunt of tax changes and many are providing support to tenants with Covid-related arrears. 

“A simplified [EPC] exemptions regime and additional financial support must be made available otherwise the measures in their current form, will not be achievable and that would mean further reductions in the supply of rented accommodation available.”

The consultation runs to 48 pages and you can see the consultation document here with details of how to respond. The closing deadline for comments is 11.45pm on December 30 - the government says it will respond next spring.

Poll: Is the government's new EPC target achievable?

PLACE YOUR VOTE BELOW

  • Neil Moores

    so its only homeowners who can keep their costs down by owning an old wreck with expensive heating, bought in the knowledge that this was the only way they could afford to live there. Having already served notice and obtained possession a couple of years ago on a energy inefficient flat; which was rented out and 70% of market value to reflect the energy costs, and which was positioned above two rundown empty shops where I was applying for planning permission to totally replace the whole building with modern flats and therefore couldn't justify the expense of a wet heating system and double glazing for what could have been a 6 or 7 month rental; I have seen first hand that this is pricing lower income tenants even more out of the rental market than before.

  • Matthew Payne

    EPCs were born out of our commitment to the Kyoto protocol in 1992, which has since been revised by the Doha amendment which we have legally committed to. The KP was created to dramtically drive down greenhouse gas emissions. The amendment was agreed a few years ago to speed up progress and makes our targets a legal requirement in international law. Huge pressure for the government to deliver especially when 40% of UK GHG emissions come from households.

    Ergo it is no surprise that HMG has brought forward the C grade date by 5 years. Even less of a surprise that this phoney consultation ends on 30 December, just 15 minutes before the Doha Amendment comes into force on the 31st December, whilst parliament is in recess and Ministers are on holiday, meaning the the government won't have time to read, let alone act on the content before our legal commitments change.

    Expect to see in January, Ministers response to the consultation being references to the enactment of the Doha Amendment on 31st December, their hands are tied, targets to hit, international law, etc etc, EPC Grade C at 2025 cannot be changed.

    Matthew Payne

    Here is the maths. Currently, 62% of EPCs are rated D-G, thats 12.2m dwellings already existing with a sub standard EPC. If the PRS makes up 20% of all dwellings, that means 2.44 million rented properties cannot be relet in just over 3 years time without £24.4 billion being spent by LLs to qualify for exemption. Thats £5billion in VAT as well as lots of economic activity and other tax. Big numbers. Perhaps the sudden date change to 2025 is as much about increasing tax receipts quickly as it is about Doha. Nothing will stop this, all D-G owners just need to work out is what they are going to do in the next 4 years.

     
  • Paul Barrett

    The climate is changing.
    It is always bloody changing.
    Got absolutely nothing to do with man.

    Nothing man does can change the climate.

    All this green crap is just an excuse to tax.

    The UK has 300 years of coal.
    It should be dug up and used.
    It will make no difference to the climate which is always changing.

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    I don't believe this government actually has any intention of listening to anyone - the Conservatives have form in this such as the feed in tariff reform consultations of 2011 where they announced the outcome of a public consultation when it still had several weeks to run, then subsequently were defeated in the courts.

    I believe the underlying attitude of this government is to hold consultations where legally required, then to announce the plans they had already formed before asking the public! Not to say they never listen, but I think the situation is now worse, with Boris Johnson seemingly more interested in ruling by decree whenever he can get away with it rather than collective decision making in cabinet, or God forbid following a full parliamentary debate!

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    This will be pushed through despite of any protests. Landlords are an easy target, those properties that achieve a 'C' rating will be priced accordingly and the lack of supply will increase. Ultimately tenants will suffer under these proposals

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    Landlords, agents and even tenants could tell the government that this is notb going to work, but we will all be ignored. The government will do what the government wants. Remember the way they listened over tenant deposits, tenant fees, Section 21? Neither do I.

     
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    Given that the Government will be implementing its proposals ('consultation' is merely a smokescreen to demonstrate democratic principles that no longer exist in this country), what I could really do with is a guide that explains in layman's terms (forgive me - I only hold a first class masters degree from a red brick university) what exactly we need to do to get our properties to the magic 'C' rating. I have been through the consultation document and note the 'fabric first' approach, however, when it comes to looking at the EPC for the rental property that I own - currently D rated - the recommendation to achieve the minimum sap rating for 'C' requires the installation of the following:

    1. Internal or external wall insulation
    2. Floor installation (suspended floor)
    3 Heating controls (thermostatic radiator valves)
    4 Solar water heating

    The average cost (as of July 2019 when the EPC was conducted) for these measures is £16,400 according to the indicative lower and upper-end figures quoted. If I really wanted to push the boat out (e.g. to get a 'C79' sap score), I could install solar photovoltaic panels at a cost of between £3,500 and £5,500). The way the EPC is worded suggests that all of these measures would need to be installed just to get to a C79 score. This begs the question as to what on earth one would need to do to get the house up to a EPC A or B rating - cover it it in bubble wrap?

    It also seems to me that if the Government does indeed apply its proposed cost cap of £10,000, then even allowing for inflation (why they ask whether they should apply this is beyond me - of course they will), won't the cost of said installations render a part-exemption and therefore the property being unable to achieve a 'C' rating in any event?

    If anyone on here could enlighten me I would be eternally grateful. As I have just purchased the property in question, redecorated and re-carpeted it, my own sap rating must surely be 10/10. Silly me for not seeing this one coming.

    Paul Barrett

    Not your fault just a venal Govt.

    Best thing you can do now is sell before LL realise about C status Even when you factor in new build premium at least they are all C status and ready to move into.

    Afraid older housing stock will be the preserve of homeowners.
    LL won't achieve full retail value if less than C status

    Time to offload the duds.

     
    Matthew Payne

    Hi Laurence, yes you are right. Basically spend £10k on items on the list and you can apply for exemption. Also worth scrutinising what ratings/stars you have on page 2 to see whether any assumptions have been made by the assessor which are incorrect. If there are, and you challenge them successfully with some evidence you might turn your D into a C with no spend.

    Bs and As are for the territory of the best ground/air source heat pumps, which is where HMG/the green agenda wants to get all housing to stock over the next 50 years as boilers are phased out. Cs are reward for not letting the heat escape, As & Bs for creating the heat without burning anything.

     
  • Philip Drake

    Lots of characterful stone built terraced houses will either be covered up by bland insulation; have the internal room dimensions shrunk; all this done in a haphazard manner along the row depending upon individual owners’ preferences; demolished to be replaced by bland new builds boxes or left in owner occupation where the poor become poorer. Whilst the few landlords, who can afford to migrate to better quality properties, reduce the available rental stock and so due to higher quality, cheaper to run and reduced numbers can increase rents so tenants suffer. Clearly landlords will be accused of profiteering.
    So mostly losers in this scenario.

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