Sherwood: Attention Landlords
The lowdown on the latest compliance laws
With the buzzword being ‘compliance’ in almost all industries, residential landlords seem to be bearing the brunt of constant new legislation and cost. Along with a myriad of essential documents the landlord must provide for tenants and the recent implementation of the 3 per cent Stamp Duty levy on investment properties and second homes, landlords are feeling the pinch. However, with interest rates at an all-time low the lure of being a landlord is still an attractive investment decision for those of us planning retirement and who don’t trust their assets in the hands of the bankers or investors.
Along with gas safety certificates, an inventory, tenancy agreement, deposit protection, ‘How to Rent’ guide and possession notices, an Energy Performance Certificate (EPC) is an essential part of the pack. EPCs were introduced in September 2007 and with their 10th anniversary soon approaching many landlords out there will be due for a renewal. So if you are a landlord it may be worth digging out your copy or checking the national register (www.epcregister.com) now as April 1st 2018 will see the ‘Minimum Energy Efficiency Standard’ or MEES come into effect. MEES was passed in March 2015 and will make it unlawful for landlords to grant a new lease of properties that have an energy rating below E (an E rating scores 39-54 out of 100 points). It will be the first time that mandatory implementation of the recommendations within the EPC report have to be carried out. Exemptions can possibly be registered but these will be re-evaluated every five years and there is no guarantee of renewal.
The first time that mandatory implementation of the recommendations within the EPC report have to be carried out
With this in mind, asset value of properties that are an F or G rating, or even a low E rating may see a reduction in value as lenders will be considering rentability of the property when making their future lending decisions. Furthermore, resale value could be affected should a landlord consider selling a property with a low energy efficiency rating.
Listed buildings which appear on the National Heritage List for England are exempt from EPCs as energy efficiency improvement measures would be prohibited. However, EPCs are required for buildings within conservation areas but certain recommendations can be omitted by the domestic energy assessor who is creating the EPC.
There are small and inexpensive measures that can be carried out should your own EPC not meet the E rating or above. Local assessors like Claire Sherwood can offer an Energy Compliance Plan whereby your property can undergo a new assessment. Following the assessment, a consultancy service is provided to advise landlords on the lowest cost retrofit measures to bring your property up to the necessary standards required for rental. The new EPC will then be lodged once the improvements have been made and the property reaches the required rating.
All details of this service can be found at www.clairesherwood.co.uk
