Eureka! The green tidal wave has been slowed down. Housing Minister Michael Gove has said that the government "should be relaxing the pace" of EPC reforms for rental properties in South London. This means that landlords in the area may have until 2030 to bring their properties up to the new minimum energy efficiency standard of C. The whispers of relaxing the standards were heard following concerns from landlords about the financial impact of the reforms, and the timescale to implement them. Many landlords felt that they would not be able to afford to make the necessary improvements to their properties, and that this would lead to a shortage of rental accommodation in the area. Well, this and of course the constant persecution of landlords in the media, excessive taxation, the general lack of any profits for investors and so on...
In other good news, the government has said that it will provide financial support to landlords to help them meet the new standards. This support will include grants and loans, as well as - hang on to your seat - tax breaks. In a Sunday Telegraph interview following the Uxbridge by-election, Housing Minister Gove gave strong hints that the timetable would change. The paper says: “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.”
The relaxation of the EPC standards would be a welcome move for landlords in South London. It will give them more time to make the necessary improvements to their properties, and it will help to ensure that there is a continued supply of rental accommodation in the area.
What does this mean for landlords in South London?
If you are a landlord in South London, you may potentially have until 2030 to bring your properties up to the new minimum energy efficiency standard of C. Currently it must be a C if you are entering into a new tenancy Band C from 31 December 2025 or existing tenancies from 31 December 2028 (where this is practical and cost-effective). Potentially this kicks the can a little bit further down the road and you will be able to access financial support from the government to help you achieve a better energy performance rating.
The relaxation of the EPC standards is a positive development for landlords, as it will help to reduce the (immediate impact of) the financial burden of the reforms. However, it is important to remember that you will still need to meet the new standards eventually, so you should start planning your improvements now.
What are the benefits of improving the EPC rating of your rental property?
There are a number of benefits to improving the EPC rating of your rental property. These include:
- Reduced energy bills for your tenants (poor tenants, yes they have it so bad - you should definitely spend four-figure sums of money so they can save £20 a month on their fuel bill, this makes perfect sense!
- Increased property value - because, ironically, less energy efficient homes will be in lesser demand.
- Increased rental demand - ironically before the pandemic and energy costs were "normal" I had never once had anyone ask me about the energy rating. Now it's asked before the distance to the tube!
If you are considering improving the EPC rating of your rental property, there are a number of things you can do. These include:
- Installing insulation
- Replacing windows and doors
- Upgrading your heating and hot water system
- Switching to more energy-efficient appliances
- You can also help to reduce carbon emissions and contribute to a cleaner environment.
If you have any questions about EPC standards for rental properties in South London, feel free to drop me a line.