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How Long Can I Continue Renting Before I Have To Sell Or Fund Expensive Changes

EPC

The energy performance certificate (EPC ) has been with us now since 1st August 2007 in England and Wales. Like all new regulations required by central government, in the beginning this was a good idea. Allowing tenants to compare running costs of similar properties and estimate the running costs of properties going forward.

Unfortunately, like most adopted by the government, the standards increase over time and are ratcheted up until they become more of a burden than a benefit to Landlords.

What Is It? 

In the earlier days, the EPC was a document of several pages that you would show to a potential tenant at a viewing. Typically, probably 8 out of 10 potential tenants would be more concerned about the colour of the walls or was the kitchen/ bathroom modern enough to take the property than the in the EPC rating and what it told them about whether they would be able to afford the heating bills.

As you are probably aware the certificate is valid for 10 years and certain rented properties are exempt like holiday let's, listed properties and HMO if you are renting rooms separately. However, most landlords will have a certificate in order to advertise there property on the portals or with a letting agent or to prevent an obstacle at an eviction hearing at the county court. 

What Is The Problem Now? 

Since April 2018 all rental properties should have a minimum of an E rating and all F and G are deemed not rentable. To be fair this is quite easy to achieve with most properties. The current consultation is looking at band C from 2025, but it is more likely that industry resistance will result in a band D or above from April 2025. Again, this is something to work towards but achievable with a few tweaks. If that is the final schedule, then we are probably looking at having to achieve a C rating by April 2030.

The C rating is more worrying as this will require Floor insulation or solar systems to achieve if you have already achieved the D with windows, loft and boiler up grades. So would this be the point to sell or make further investment to lots of landlords. More to the point - if big investment is going to be required in 2030, does that mean that property values for properties that need these works will fall in 2027 or 2028 to reflect the costs of work needed?

If the penny has just dropped, the good news is that you have time to react. For most, the necessary changes can be achieved as part of normal upgrades and refurbishments but do you know what specifically you will need to do with each of your properties?

Obviously, read   this can be achievable with least pain and with a bit of help from this months speaker Andrea Bailey who is one of associations recommended EPC assessors.

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