New EPC Regulations Impact Lettings

Much accommodation built in the late 20th Century for farm labourers is redundant for that purpose and is now let out. Whilst it can produce a good income stream,  there have been many changes to the residential let sector law and regulations in recent years. Of particular note is the introduction of the Private Residential Tenancy (PRT) last December, plus the Tenant Deposit Scheme, Energy Performance Certificates (EPC) bandings and Landlord Registration.

The EPC rating is a useful tool to calculate energy use, but there has never been a minimum standard. That is set to change and could significantly impact rural properties, built of stone and slate, with traditionally low ratings. In the future, it may not be legally possible to let some residential properties and these requirements may be a headache for rural landlords.

  • For existing tenancies: All properties must be a Band E or above by 31st March 2022  and must be a Band D or above by 31st March 2025.
  • For new tenancies: All properties must be Band E or above by 1st April 2020  and must be a Band D or above by 1st April 2022.

In England, from 1st April 2018 all private domestic Landlords must ensure that any domestic property they let has an EPC banding of at least an E before granting a tenancy to a new tenant or renewing an existing tenancy. This is to extend to all private rented properties from 1 April 2020 even when there has been no change in tenancy arrangements.

EPC efficiency can improve, but substantial investment may be needed. There is some discussion on allowing lower minimum ratings for properties that have  had significant sums of money spent on them to improve energy efficiencies. Also there may be grants and loans to finance improvements. Property owners should review  their property portfolio’s existing EPC certificates  and prepare for improvements where needed to achieve the new minimum rating.

To find out more – contact our Property management Team or your local D&R Office.

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