Update to Energy Performance Guidance
The Government has finally released guidance on the minimum rating for rental properties that will be coming into effect next April (our previous blog on the EPC changes can be read here).
Exemptions to EPC Regulation
The Government has now clarified that exemptions will apply if:
- the landlord is unable to obtain funding to cover the cost of making improvements
- all improvements which can reasonably be made have been made, and the property remains below an EPC rating of Band E.
Interestingly, this means that if a landlord is not able to obtain funding to undertake the recommended improvements via one of four options detailed below, they will be exempt from meeting the minimum energy efficiency level.
Funding Available for EPC Regulation
The four options available are:
- a Green Deal Plan
- Energy Company Obligation or similar scheme
- Funding provided by central government or local authority or third party at no cost to the landlord
- a combination of any of the above
The regulation is based on the principle of ‘no cost to the landlord’. Where funding is available to cover the cost of the recommended improvements, the landlord will be required to undertake them. If funding is not available to cover the whole cost, then the exemption applies.
Furthermore, changes to the way EPC grades are calculated could mean that having another assessment carried out on a property could raise the banding without landlords having to undertake any improvements.
Landlords need to be cautious about spending money on making energy performance improvements to avoid unnecessary costly outlay.
You can view the Government’s Domestic Private Rented Landlord Guidance in full by clicking here.
If you would like to book for a new EPC to be carried out at your property, so you can work out whether you will need to obtain funding for improvements, please give the team at McCartan a call on 01792 430100.
Sources: Gov.UK / PainSmith on Guidance / PainSmith on Funding in Detail / PainSmith on Funding Continued
Related: Could your EPC stop you from letting out your property in Swansea? / Are you liable for paying your tenant's water bill?