A new proposed Minimum Energy Performance Standard (MEPS) to be introduced in April 2018 will affect around two million private landlords and five million properties in the UK (Paragon)
Investors, landlords and tenants will be affected from April 2018 when the proposed legislation changes will make it unlawful to let residential or commercial properties with an EPC Rating of F or G, the 2 lowest energy grades.
The Energy Act 2011 contains provisions affecting property owners and occupiers. Landlords will need to register any exemptions if the property does not reach an E rating by 1st April 2018.
This could have significant marketability implications for landlords who wish to rent properties across 5 million UK properties which would be impossible unless they were upgraded to meet the minimum standards. It is estimated that approximately 20% of non domestic properties are in the F & G rating brackets.
Valuations of such properties could be affected if their marketability is diminished. Make sure you are looking after your portfolio.
Rent reviews for properties in this situation could be affected and the implication for dilapidation assessments could also exist.
Property Search Group offered their advice to landlords and tenants:
“Given this risk to property owners and occupiers, a full understanding of the efficiency of your property should be undertaken. Then owners and occupiers can assess the cost and viability of undertaking retrofits and refurbishment.”
• All rentable properties need an EPC
• Where the rating is F or G an energy efficiency plans need to be put in place to improve the property
• Energy improvements should take place in void periods, lease breaks and during ongoing maintenance of the building
• Energy efficiency improvements need to be implemented before April 2018
Make sure you are meeting the prescribed MEPS and plan ahead to utilise the time between now and 2018 to be sure of your requirements.
Expert Opinion supplied by Property Search Group