After April, new rules mean you cannot legally rent out a property unless it passes a minimum energy efficiency test.
According to Government figures, more than 400,000 properties in England and Wales could be unlettable if their owners don’t act swiftly.
So, what do you need to know?
- From 1 April, the minimum energy efficiency standard (MEES) for new lettings is set at an E rating for all types of domestic and non-domestic property. Without this, it will not be possible to issue a new tenancy or renew an existing tenancy;
- The regulations cover all tenancies including assured, shorthold or otherwise;
- From 1 April 2020, a landlord may not continue to let a domestic privately rented property without this minimum rating;
- From 1 April 2023, a landlord may not continue to let a non-domestic privately rented property without this minimum rating;
- A tenant granting an under lease will be a landlord for the purposes of these regulations;
- If your last EPC rating was below an E, you need to get an up-to-date EPC report carried out and if it remains below an E, you will need to carry out enough of the improvement measures listed in the report to boost the rating;
- There are some exemptions but these must be registered on the Private Rented Sector Exemptions Register;
- There is the option to fund improvements by taking a loan with the Green Deal Finance Company or via your own bank and the Government is looking at capping the amount spent on upgrades at £2,500;
- The MEES regulations do not impose an obligation on landlords to carry out energy efficiency improvement works but the restrictions apply if the landlord wants to let the property and penalties will be imposed if restrictions are breached;
- Each non-domestic letting that breaches MEES regulations could result in a fine of £10,000 or 20 per cent of the rateable value of the property, whichever is the higher, up to a maximum of £150,000. The equivalent domestic penalty is a maximum of £4,000.