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Minimum Energy Efficiency Standards

Posted: 20th February 2018

Category: General

In an effort to improve the quality of the UK’s housing stock Minimum Energy Efficiency Standards (MEES) mean that from 1st April 2018 Landlords of Assured Tenancies in England must ensure that their properties reach at least an Energy Performance Certificate (EPC) rating of E before granting a new or renewed tenancy to new or existing tenants.

These requirements will then apply from 1st April 2020 to all private rented properties even where there has been no change in tenancy arrangements (or from 1 April 2023 for non-domestic properties).  This will mainly catch a Rent Act protected tenant or a Statutory Peri:odic tenancy that commenced before 1st April 2018.

THE PENALTY:
£5,000 to £10,000 rising for continued failure to comply to a maximum of £150,000.

EXEMPT & EXCLUDED PROPERTIES:
A property only falls under the requirements if it is one that requires an EPC.  For example, certain listed buildings or a property that continues to be let but the EPC is more than 10 years old will be outside the standards until it is re-let.
Exempt from the requirements are properties let for less than 6 months, for instance holiday lets.  Otherwise a landlord can request a 5-year exemption by registering on the PRS Exemption Register.  To qualify the landlord must show either that:
1. The works required to achieve the minimum energy efficiency rating do not pay for themselves over a seven-year period;
2. A third party has prevented the works from taking place by refusing consent (despite ‘reasonable efforts’ to obtain it);
3. The works reduce the properties capital/rental value by more than 5%;
4. A landlord is ‘forced’ into a letting (e.g. due to a contractual arrangement)
5. There are many other nuances to other exemptions too numerous to list here If you are a client of our Property Management department, we will consider this for you.

Landlords need to consider their options NOW to be ready for 1st April and investment buyers need to think about the energy performance of the property they are buying.  If you need advice, speak to us any time. Open and honest advice, freely given.