EPC ratings for rental properties

All properties, whether you are buying or renting, must have a valid EPC certificate to show potential buyers and tenants the energy efficiency of their prospective new home. Each property is given a rating from A (most efficient) to G (least efficient) and the certification is valid for 10 years.

Since 2018 all rented properties in England and Wales (except some listed buildings) must have a minimum energy rating of E, with this rising to a C rating for all new tenancies by 2025 and all private rented housing by April 2028 under existing government plans.

Naturally this has been a controversial policy as many properties may need considerable improvements to meet this deadline at a time when landlords are facing the challenges of increased compliance requirements, rising taxation, rising costs of buy-to-let mortgages and the proposed changes in the rental reform bill we discussed in our blog last month.

A recent Rightmove study found that 33% of landlords who own lower rated EPC properties were planning to sell them rather than make improvements, with currently 16% of properties on the portal having been previously available on the rental market - up from 13% before the pandemic. This will add further strain to the rental market for tenants already impacted by a reduced supply of properties and the higher rents that come with increased demand.

Last week, however, there was some potential movement on the 2028 deadline when Housing Secretary, Michael Gove, gave strong hints in an article in The Telegraph that he was looking to ‘relax the pace’ of the changes.

The article stated that: “Mr Gove admitted that in his own department the government was ‘asking too much too quickly’ of landlords, who will be banned from renting out their homes unless they pay for green measures such as insulation and heat pumps to meet a new minimum energy efficiency threshold by 2028.”

This has been welcomed by the National Residential Landlords Association (NRLA) but the industry body is pushing for further clarity and a realistic timescale for any energy efficiency rating changes so landlords can plan accordingly.

Ben Beadle, chief executive of the Association, says: “Ministers need to develop a proper plan that includes a fair financial package to support improvements in the private rented sector. We will continue to work with all parties to develop pragmatic and workable proposals.”

At Poole Townsend, our energy assessors conduct EPC certification for all vendors looking to sell their properties and can extend this service to landlords. Determining the recommended measures required to improve the energy efficiency of your properties will prepare you for any changes the government wants to make to the current legislation.

For advice on EPCs, buy to let mortgages, compliance or any other challenges you face as a landlord, get in touch with our lettings experts.

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