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Agency demands government clarity over new EPC rental targets

A leading property agency is demanding more certainty over new Energy Performance Certificate regulations. 

Fisher German says the government should act now if it plans to reform EPC regulations and provide the private rental sector with more certainty about how and when this will happen.

This comes after Housing Secretary Michael Gove recently suggested the government should relax the timescale for the new EPC regulations, claiming that they are putting unrealistic pressures on landlords.


The government has since announced that the EPCs need ‘fundamental reform’ which may mean that the pressure is being taken off the rental sector after realising that meeting the guidelines on some properties would be physically impossible.

Fisher German partner Neil Hogbin, of the firm’s property management team, says older period properties may need thousands of pounds to meet targets.

“We are already beginning to see a shortage of rental properties in the marketplace as landlords start to sell up.  Combined with the increase in energy prices because of the war in Ukraine, there is a further threat that rents will continue to rise to cover some of the costs of the EPC improvements being forced upon private landlords as they scramble to meet the new energy efficiency targets being set.  

“Decent homes in the private rented sector will no longer be affordable to many. 

“We all want to see properties as energy efficient as possible, but the sector needs certainty about how and when this will happen. 

“Landlords are looking for a financial package to support improvements in the private rented sector but, it is all still very unclear.”  

Meanwhile Hogbin says the owner-occupied housing sector has no minimum energy efficiency requirements at all. 

“Many of the EPC changes are simply not practical, affordable, or wanted by many tenants – particularly those in period properties. It is seen as unfair that the private sector landlords, many of whom provide high-quality well-managed homes, should have to deliver on EPC targets ahead of other housing market sectors.  

“They are already taking steps to be more environmentally conscious with low-carbon heating systems, and well-insulated homes where sensible and cost-effective to do so and shouldn’t need to be regulated to deliver on this.”

Research from Rightmove has revealed how landlords are now investing in properties with an EPC rating of C or above to meet these impending new Government rules and are actively avoiding lower EPC-rated homes. The survey also showed that 80 per cent of landlords are aware of proposed changes to EPC legislation, compared to 65 per cent last year. 

The government has revealed that the likely cost of EPC upgrades for rental properties could be between £5,000 and £15,000 depending on the property, with only a third being improved for under £5,000. Older, period property will likely need far greater expenditure than more modern housing stock.  

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    From what I read in the professional property press it seems pretty certain that the Conservatives are looking at:
    1. The Tory's excellent, flagship legislation of the Minimum Energy Efficiency Standard 2015 (MEES) will be slowed down for the domestic rental sector. EPC Grade D, as a minimum by 2028, for new lettings and continuing lettings seems to be their preferred pathway. Grade D is the average grade for a UK home.
    2. The sensible MEES self-exemption register will remain in place allowing domestic landlords to continue to rent out their units if the cost of upgrade is prohibitively high. Many landlords have already self-exempted themselves from the MEES Grade E minimum standard. All makes sense.
    3. The domestic EPC national measurement system will be bought in line with commercial EPCs and will show the carbon dioxide pollution measure as the primary EPC Grade. The current running cost EPC Grade will also be shown. The EPC Recommendations will then NOT recommend the installation of new gas boilers - this is the reform that many Letting Today readers have been calling for.
    4. For houses and flats with different heating systems domestic energy assessors will now have to use the Full SAP software which allows for many more inputs and is much more accurate (that's why legally it has to be used for all new housing EPCs). Again this brings domestic EPCs in line with commercial EPCs where, since 2008, complex commercial buildings have had to be assessed by more highly qualified professionals.

    This all seems rational, appropriate and proportionate. This will help to steadily improve private rental houses and flats over the long-term to be 'fit-for-purpose' for both landlords and tenants.

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    Look everyone, Gibbons can copy/paste.


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