It's All About Me(es)!

I would hope that Landlords will know that before a property can be let on a new lease, it has to have an EPC (Energy Performance Certificate) before it can be let. Energy efficiency levels are put into seven bands, A to G, with A being the most efficient and G being the least efficient.

As from April 2018 there will be the Minimum Energy Efficiency Standard MEES. Under this, properties must reach A to E and those that do not meet these levels and fall into F and G will have a problem. It will be unlawful to let them on any new lease although I may have some good news.

“It’s nearly a year away!” I hear you say. But as a week is a long time in politics, a year is a short time in property! It’s time to consider appropriate action NOW so you’re not caught out. With councils looking at more ways to raise money, you can be sure that Trading Standards Officers (who I understand will be in charge of this legislation) will be vigilant.

One of the important things to realise is that improvements must be made to the structure of the property, and so advising tenants to close doors and windows will not be adequate. We need to look at proper permanent improvements. I have done some research on this, and it seems that there are generally considered to be four elements that can be considered for improvement as follows:

Roofs ¥ Walls ¥ Windows ¥ Heating Systems

A good EPC assessor can advise you on all of these. Whilst writing, if you are or you know of a good EPC assessor, get in touch. I don’t have one at the moment.

Landlords will be aware that they may spend huge amounts of money for nominal benefit. Insulation itself costs money, and any internal insulation will not only cost money (potentially including resiting radiators, light switches and power sockets), but will reduce the sizes of rooms. For example a room 5 metres by 4 metres exactly, (20 square metres)once insulation and new wall finish thickness of 120 mm is introduced all round, will reduce in size by 2.1 square metres. So here’s two rules to be followed:

The ‘Golden Rule’: If an independent assessor determines that all relevant improvements have already been made to the property or that improvements that could still be made would not pay for themselves through energy savings within seven years, the work may not be required. Also wall insulation measures are not required where an expert determines that these would damage the fabric of the property. In my example above, the work may cost £2,500, £357 a year to be saved.

Devaluation: where an independent surveyor determines that the relevant energy efficiency improvements that could be made to the property are likely to reduce the market value of the property by more than 5%. In my example above, the room size reduced by 10.5%.

I told you there may be some good news.