Environmental ruling could limit what properties landlords can rent out

Regulations being presented to Parliament today will ban landlords from renting England and Wales’ most inefficient homes, if approved

In an attempt to reduce energy bills and carbon emissions, landlords will not be able to rent properties given the lowest rated Energy Performance Certificates (EPC) under the new regulations.

If approved, the ruling will come into action from 2018 and restrict landlords from renting out homes which have an EPC rating of F or G.

Instead, landlords will need to ensure their rental properties carry an EPC rating of E or higher – completing necessary improvements to efficiency as required.

Failure to complete this action will result in landlords being banned from renting out properties which do not meet the minimum standards; affecting thousands of homes as nearly 10 per cent of English and Welsh homes are currently rated E or lower.

An important step for the rental market

Proposed by Energy and Climate Secretary Ed Davey, the new regulations have been suggested after it was found that around one million renters pay up to £1,000 a year on utility bills.

Davey described the new plans as a “very big measure” that would make the situation fairer for all – renters would enjoy lower maintenance costs while landlords could ensure continual tenancy and reduce the risk of void periods by providing more attractive properties which meet these standards.

“Effectively, we’re saying, if you do not improve your property up to the minimum of EPC E rating by three years’ time, you will not be able to let out that property,” he explained.

Although this would initially result in outlays from buy to let investors and landlords, the long term benefits could reap plenty of rewards.

More energy efficient properties are likely to attract more interest on the rental market – reducing the risk of void periods – and could even attract higher rents and generate greater profits.

Acting CEO of the UK Green Building Council John Alker believes these changes could even be the most important piece of legislation to affect existing building stock in a generation while Richard Lambert, CEO of the National Landlords Association (NLA), also welcomed the idea.

He said the regulations would strike a balance between making it clear what is expected from landlords and ensuring it is realistic that they are able to comply.

By setting the new minimum standards for efficiency at a “sensible rather than aspirational” level, he claims they will not impose an unreasonable burden on landlords but improve the rental market overall.

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