From the 1st of April 2018 the minimum energy efficiency standard/EPC rating required to grant a new lease will be a rating of E (39 SAP points).
A valid EPC is required to prove that the property meets the minimum rating.
What happens if all recommendations/improvements measures are carried out or there are none that can be made and the EPC rating is still sub-standard, lower than an ‘E’ rating?
In certain, limited, circumstances landlords may be able to claim an exemption. Where a valid exemption applies, landlords must register the exemption on the database set up for this purpose – the PRS Exemptions Register
What are the exemptions?
Buildings which are not legally required to have an EPC such as listed buildings
Buildings let on leases over 99 years or less than 6 months
Impact on vale and high cost exemption - if the improvements devalue the property by more than 5% or do not meet the 7 year payback rule
Consent exemption - if you cannot get consent to make improvements such as planning, consent from a superior landlord etc
All exemptions must be lodged on the PRS Exemptions Register with related evidence.
How long will the exemption last?
The landlord will be exempt from letting a sub-standard property for 5 years from the date of registration. In the event of a person suddenly becoming a landlord then a temporary exemption will last for 6 months
Exemptions claimed by the landlord may not pass over to a new owner of a property upon sale or transfer, they will cease
What are the penalties?
The enforcement authority may impose a financial penalty of potentially up to £150,000 or up to 20% of the rateable value for commercial property and up to £5,000 for domestic properties subject to how long the landlord has let a sub-standard property unlawfully
What next and what can I do?
The Government has also announced their aim to raise the minimum standard to D rating in 2025 and a C rating by 2030. We advise visiting the EPC register website to check if a valid EPC exists for your property and what the current score is.
GDImpact have been at the forefront of EPC services since they were introduced in late 2007
We have helped thousands of landlords and sellers stay compliant with up to date and accurate EPC assessments.
As a leading supplier of EPCs, Land Registry Lease/Scale Plans and Asbestos Surveys - we can provide multiple reports from one site visit and for one discounted fee.
For further information or advice please contact our experienced and friendly team on 01273 640224