New Minimum Energy Efficiency Standards (MEES) were introduced on April 1 2018, making it illegal for landlords to let a domestic property in England and Wales with a rating of F or G on Energy Performance Certificates (EPC).
From April 1 2020 this now applies to all property types (apart from those who have qualified for exemption), so if your rental property needs to be upgraded, here are the key points to look out for.
How to improve the EPC rating
Whether it’s installing new doors, windows or insulation, there are a number of ways to improve a property’s EPC rating. Visit the Energy Savings Trust to get official recommendations on how to achieve the minimum E rating.
Find an accredited energy assessor
Visit the Domestic Energy Performance Certificate Register to find an accredited person to carry out an energy assessment, or to verify that an individual is accredited to carry out the job.
Spending cap
There is a personal spending cap of £3,500 (including VAT), which means you are not required to spend beyond that limit when carrying out energy efficiency improvement works.
This also means if the cost to bring an ‘F’ or ‘G’ property up to standard costs more than £3,500, you must do as much as possible for that amount before registering for an exemption.
However, this is only applicable to your personal spend. If any official funding has been received to support the cost of carrying out the improvements, this will not count towards the £3,500.
Whether you believe £3,500 is affordable or not, the introduction of these changes could mean that you are forced to spend the full limit should you breach the MEES rules.
Changes to exemptions
From March 31 2020 landlords will no longer be able to claim exemption based on the fact they are unable to fund the required improvements.
Previously, if an existing tenant withheld consent to a Green Deal finance plan such as this, landlords were able to register an exemption. This has now been removed and can no longer be used as a valid reason for not carrying out the changes.
MEES fines
Failure to meet the new standards set out by the MEES could lead to a fine of up to £5,000 being imposed by your local authority. There are a number of ways this could be issued:
- Failure to comply with a council issued compliance notice: up to £2,000
- Exceeding regulations for 3 months or more: up to £4,000
- Entering false or misleading information on the PRS Exemptions Register: up to £1,000
Reality of costs
While the personal spending limit is set at £3,500, the reality is it may not cost that much to make the necessary changes. According to a study carried out by Which? Magazine, to upgrade older properties from EPC grades ‘F’ and ‘G’ costs an average of £1,200.
Of course, this is only an average figure and can differ from property to property, depending on the amount of work that needs to be carried out.
If you are a landlord and have any questions regarding the new Minimum Energy Efficiency Standards (MEES), please call our expert letting agent team on 020 8459 2530 who will be happy to provide you with more information.