Energy Performance Certificate Guide

In this section

More and more landlords have been coming to us recently wanting to know about EPC regulations and some changes that are looming. Until recently, most people have viewed EPCs as a bit of a pointless requirement, with no real defined purpose. But the Energy Act 2011 has set some key dates that will introduce new requirements that, as a landlord, you need to be aware of.

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EPCs now have teeth – this is what you need to know to make sure they don’t bite you!

From April 2016, Landlords have had an obligation to carry out the improvement measures identified in the EPC if requested to do so by the Tenants. This work must be undertaken, providing there is funding available for the Landlord to do so under the ‘Green Deal’ or other similar scheme such as the Energy Company Obligation (ECO).

Essentially, these schemes allow energy improvement work to be carried out with the cost of the work being added to the utility bills over a defined period of time. The additional cost cannot be higher than the usual billing amount. When the cost of the work has been paid, the utility cost will reduce back to actual usage only.

Basically, this means if the Landlord doesn’t suffer any ‘upfront’ costs the work cannot be refused.

This is really just the first step to the much more severe restriction to be introduced in April 2018 whereby it will be prohibited to start a new tenancy if the EPC rating is either an ‘F’ or ‘G’ (renewing an existing tenancy will be fine).

EPC EPCs are rated from A to G

There are some caveats attached to this – mainly that, as with the above, all of the improvements indicated on the EPC have been carried out, again providing there is no upfront cost to the landlord. If all the identified work has been completed and the property does not reach an ‘E’ rating, then it may still be let.

As mentioned, this will apply for new tenancies starting from 1st April 2018, but there is a ‘back stop’ date of April 2023 where this requirement can be applied to all rental properties that fall into EPC regulations.

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What Do I Need To Do?

We recommend checking your EPC now to see if this will affect your property. If it does fall into an ‘F’ or ‘G’ banding, make plans now to have some of the improvement work done in the next gap in tenancy or during the current one if the work won’t be too disruptive to your current tenants. They shouldn’t mind too much, especially as the work should lead to lower utility bills for the property.

EPC money

One of our key objectives is to help landlords to minimise void periods and by doing so maximise the return on your investment. By being proactive in addressing EPC requirements at an early stage you will better manage and reduce any potential gaps in tenancy once these regulations have been introduced. 

To find out how you can reduce void periods, property damage and rent arrears go to our landlords advice page and find out how we can help you get the most out of your investment.

What Else Do I Need To Know About EPCs?

Energy Performance Certificates (EPCs) are required when most properties are advertised to let. EPC’s were introduced as a requirement in Lettings on the 1st October 2008 for all properties let from then onwards.

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What Is An EPC?

An EPC is effectively an energy efficiency and environmental impact assessment for a property. The property is assessed by a Domestic Energy Assessor and is given a current rating from ‘A’ (very good) to ‘G’ (very poor). It is also given a potential rating, which is an indication of the impact that suggested improvements could make.

EPC gauge

EPCs are valid for 10 years, so once you have an EPC you don’t need to worry about renewing on an annual basis. However, there are some circumstances where it may be beneficial to do so – for example, if you were to significantly improve the energy efficiency of your property. Also, as EPCs have been around in some cases since 2006, you should double check the date of your EPC as you may need to commission a new one the next time your property is advertised.

EPCs are required when a property is put on to the market and should be made available (free of charge) to any applicants who are interested in viewing the property – or to anyone who requests to see the EPC. The legislation requires an EPC to be available 7 days after the property is advertised, with a maximum of 28 days given to obtain one. If an EPC is not available after 7 days, you should be able to produce evidence that one has been ordered. Failure to produce an EPC can result in a fine of £200. If you do not have one 28 days after marketing commenced, the property should be withdrawn until the EPC is available.

If you have any questions about EPCs, please go to our contact form and we will be happy to help.

Why Do I Need An EPC?

EPCs are required so that any interested parties are able to make an informed decision about the likely running costs of a property before they commit to renting it. This can work in your favour if your property is the same price as another one – but the running costs are lower due to greater energy efficiency – this is one of the reasons to update your EPC if you have had improvement work done.

EPCs are also one of the benchmarks used by the government to assess and control the quality of rental housing stock.

What Properties Are Exempt From EPC Regulations?

There are some exemptions from EPC regulations, currently these include:

  • Tenancies beginning before 1st October 2008
  • Listed buildings
  • Non-Permanent

If you have any questions about EPCs, please go to our contact form and we will be happy to help.