New regulations: Landlords prepare for new energy efficiency regulations

Thursday 14th January 2016

Landlords and tenants of both domestic and non-domestic private rented premises should start preparing for new regulations requiring many of them to make energy efficiency improvements to their properties before they can continue to be rented out.

 

The Government has now issued the necessary regulations. From 1 April 2016, private landlords of domestic properties in England and Wales will have to consent to specific types of energy efficiency improvements their tenants want to carry out.

 

From 1 April 2018, private landlords will not be able to rent out either domestic or non-domestic properties that have not achieved an ‘E’ energy rating. There is a limited range of exemptions and exceptions, including properties:

 

  • that do not need an Energy Performance Certificate under the relevant regulations
  • subject to leases for six months or less (though they are not exempt if the same tenant has occupied the property for more than 12 months)
  • subject to leases for 99 years or more
  • where the landlord has carried out all ‘relevant energy efficiency improvements’ (as defined), or no such improvements can be made
  • whose landlord cannot get the necessary consents (having made reasonable efforts) or a consent is given but is subject to unreasonable conditions
  • where the necessary works would reduce the property’s market value by 5 per cent or more

 

The exemptions/exceptions are recorded in a central register and expire after five years, unless renewed.

 

From 1 April 2023, the requirement for an ‘E’ energy rating will extend to existing tenancies.

 

Operative date

  • 1 April 2016

 

Recommendations

  • Landlords should start reviewing their property portfolios to identify properties that will require work to achieve an ‘E’ energy rating, when they may be able to carry works out, and whether tenants may ask for consent to make energy efficiency improvements
  • They should also consider amendments to their standard leases

 

© Atom Content Marketing 2016

Author: Paul Ridehalgh

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