Two-thirds of England’s rental homes are not energy efficient with just one
third having an energy performance certificate (EPC) rating currently of C
or above, researchers have found.
The news from Octane Capital highlights that the government has set the
rental sector a 2028 target for all homes to have a minimum EPC rating of C
or above – with the firm warning that many landlords will not have the
financial resources to improve their properties.
And, it has been revealed that one council is telling private tenants in
its area to inform them of any landlord renting a property with an
unacceptable EPC rating.
There has been a legal requirement since 2007 for all homes to have an EPC
to show prospective tenants or buyers whether the property is
energy-efficient or not and from 2018, the minimum rating for a rented home
has been ‘E’.
Tenants are now facing paying much higher energy bills
Jonathan Samuels, the chief executive of Octane Capital, said that many
tenants are now facing much higher energy bills than they would do if they
lived in an energy-efficient home – and their bills are set to climb
significantly this year.
He said: “The cost for improving a property’s EPC rating to a C will be
substantial and many landlords will not have the financial resources to do
this thanks to an increase in stamp duty when buying a BTL home and
legislative changes to tax relief.”
Mr Samuels says that the government should be encouraging buy to let
investment in a bid to boost standards across the private rental sector but
says there appears to have been a government campaign against landlords
that has been ‘inadvertently detrimental to many tenants’.
Landlords will need to be aware that the legal process to raise the minimum
EPC rating for rental homes began last week with the second reading of the
Minimum Energy Performance of Buildings (No. 2) Bill in the House of
Commons.
Octane says that of 5 million rental homes, just 1.6 million of them have
an EPC rating of C or above.
Working with landlords to raise awareness
However, Hastings Council says it has been working with landlords there to
raise awareness of the current minimum EPC standards which means properties
must have a rating of E or above.
For any property below a rating of E, the landlord must make immediate
improvements unless they are exempt from doing so.
This could cost landlords up to £5,000 per property and the council says it
has been contacting letting agents and landlords to remind them of their
legal obligations.
It is also holding online workshops, sending out information and asking
residents who fear that they may be renting a property that has an EPC
rating of F or G, or may not have a valid EPC, to get in touch.
‘Landlords will be aware of their EPC obligations’
The managing director of accommodation for students, Simon Thompson, said:
“Most landlords will be aware of their EPC obligations and will have made
their properties energy-efficient, though not all of them will appreciate
that the need for a rating of C or above will be required by 2028.
“As Mr Samuels rightly points out, landlords have had to deal with
government legislation that has affected profitability, plus the Covid-19
pandemic which has brought worries over rent arrears and repossession
timescales.
“Responsible landlords will be working towards the new 2028 deadline for
their homes, but we may see landlords leaving the sector when faced with
the potential energy improvement costs.”
Rogue social housing landlords will be ‘named and shamed’
Meanwhile, the government has unveiled plans for naming and shaming rogue
social housing landlords who deliver sub-standard homes for rent.
It says the move will hold landlords to account and are part of new reforms
to the rental sector that have been unveiled this week.
The aim is to highlight those landlords who fail to provide safe and
habitable homes and will include those who breach consumer standards that
have been laid down by the Regulator of Social Housing, or where a finding
of ‘severe maladministration’ has been found against a landlord by the
Housing Ombudsman.
Shaming rogue landlords on social media channels
Along with naming and shaming rogue landlords on social media channels and
on the government’s website, the reforms will also see the establishing of
a ‘resident panel’ to enable social housing tenants to be heard by the
government ‘directly’.
This will see 250 people in England being invited to discuss their
experiences, the Department for Levelling Up, Housing and Communities
(DLUHC) has announced.
Eddies Hughes, the Minister for Social Housing, said: “Everyone in this
country deserves to live in a safe and decent home.”
He added that it is unacceptable that tenants should have mould on walls or
have water dripping from their ceiling.
Tougher rules on social housing landlords
Now draft legislation will be published that will lead to tougher rules on
social housing landlords for failing to meet acceptable living standards.
Mr Hughes added: “This package will help to deliver on our commitment in
the Levelling Up White Paper to halve the number of non-decent rented homes
by 2030.”
The government has also unveiled plans to carry out a nationwide survey
that will see 5,000 tenants being asked to share their opinions on their
landlord services.
The purpose of the survey is to monitor the impact of the upcoming reforms.
