Landlords need to keep the right side of new energy rules
With the introduction of MEES – that's Minimum Energy Efficiency Standards – as of April 1, 2018, it has been unlawful to let a property with an energy performance rating less than E.
Furthermore by April 1, 2020, the same rule will apply to existing tenancies which commenced before April 1 last year.
On November 4 the Government published its response to the consultation on proposals to amend the 2015 regulations and will look to implement these changes this year. The response details the introduction of a cap on expenditure that a landlord would have to spend in order to improve a substandard property.
The initial consultation proposed a cap at £2,500 but this has since been revised to £3,500. This figure is inclusive of VAT, grant funded elements and any expenditure on energy improvement works since October 1, 2017. If the landlord can demonstrate the level of expenditure has exceeded this figure and the property still fails to meet the minimum requirement of an E rating, an exemption can be registered.
The capped expenditure will replace the current ‘no cost to the landlord’ exemption. This will be an issue for those who have already registered under this exemption as these will all terminate after April 1, 2020. Those affected will be notified directly via the Exemptions Register in order for them to take action to ensure they are not in breach of the regulations post-April 1, 2020.
It is important for any landlords of private rented housing to adopt a continual review process of their property’s energy performance above and beyond the current minimum requirements, with whispers of the minimum requirement to increase in the future.
Although exemptions in some situations may be suitable they should not be relied upon as they are temporary, the majority only lasting five years.
Amy Henderson is an associate at Balfours
