Minimum Energy Standards for Investment Properties Draws Closer

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There is now less than a month for landlords in England and Wales to ensure that their properties comply with minimum energy standards.

From 1 April all properties let on new tenancies will require a certificate to prove that they have a minimum energy standards EPC rating of E. This is likely to save tenants huge sums on their energy bills. Government figures have revealed that the average energy bills for a band G property stand at £2,860 a year. For band E properties, E they are £1,710 a year, meaning tenants could save more than £1,000 on their annual fuel bills.

The government has capped the amount that it expects landlords to spend bringing properties up to scratch at £2,500. There is a consultation under way that does not end until 13 March.

According to a report from Parity Projects for the UK Green Building Council it is possible to bring a home to standard for £2,500 or less. The report puts the average cost of raising an F or G rating to an E at about £1,400, with many homes moving into this higher band for less than £1,000. Getting into energy standards band D would cost an additional £1,300.

There are certain exemptions to the government legislation, including for some listed buildings and ‘hard to treat’ properties where. The latter type consists of properties for which solid or cavity wall insulation is inappropriate for structural reasons. Landlords who obtain exemptions will generally be allowed to defer the improvements for up to five years.

Many landlords have been getting their homes in order ahead of the changes coming into practice. The number of properties with n EPC rating of F or G has fallen from approximately 700,000 in 2012 to just 300,000 today.

Chief executive of the Association of Residential Letting Agents (ARLA), David Cox, spoke out: ‘After the deadline passes at the end of this month, landlords face fines of up to £4,000 for flouting the law, or losing money on empty properties which can’t be let until they meet the standards. This will also have implications on the wider rental market, which is in the midst of a serious supply crisis.’

He continued: ‘There are Green Deal finance plans available and you can contact companies such as Propertymark’s industry supplier ECO-Energi to find out how to upgrade your property for a low cost. For any landlords who haven’t yet started to upgrade their properties, now is the time to act, and quickly.’

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