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Propertymark raises concerns over new energy efficiency proposals

From Robert Ulph on February 1, 2021

The Government has proposed that the energy performance of privately rented homes must meet a Band C Energy Performance Certificate (EPC) or higher, for all new tenancies from 1st April 2025 and all existing tenancies from 1st April 2028.

Propertymark has responded to the consultation with a number of concerns. These relate to affordability and the need to look beyond a one-size fits all policy and develop proposals that work with the different age, condition, and size of properties in the private rented sector.

For the private rented sector in England and Wales, it is only a year since rules came into force to ensure all private rented tenancies meet EPC Band E, but the new proposals mean going to Band C within five years.

The Government also proposes to increase the cost cap to £10,000 per property; set a requirement for landlords to install ‘fabric first’ measures; as well as requirements on letting agents and online property platforms to only advertise and let properties compliant with the rules.

Propertymark believes that forcing tighter restrictions on landlords, without sustained financial support, is too ambitious and will not be achieved. A key concern from Propertymark members is that the target is unrealistic and it is impractical to improve many properties based on the construction type and age. In addition, the number of houses available to rent would be reduced as so much of the current housing stock requires significant improvement to get it to a C rating.

The recommendation from Propertymark is that the Government must set a long-term goal with incremental targets to a property rather than seeking to meet one-off targets for energy efficiency.

There are also questions raised over funding and a call for better funding options for the private rented sector. Without incentives or accessible funding, it is likely that targets for the private rented sector will not be met. Under the Green Homes Grant scheme (in England), the Government funds up to two-thirds of the cost of home improvements up to £5,000. However, landlords must redeem the voucher and ensure improvements are completed by 31 March 2022.

There are also further implications for listed buildings or those in a conservation area and Propertymark is calling on the Government to consider removing the requirement for minimum energy efficiency standards from listed buildings and those in a conservation area by offsetting the carbon emissions through planting trees and sponsoring offset schemes.

It is also recognised that the long-term impacts of Covid-19 are a factor, especially for landlords who have been affected financially. There has also been some difficulty for the sector to comply with existing legislation, where access is required to carry out maintenance work or make energy efficiency improvements, let alone further requirements.

I will keep you updated, but if you have questions on this or require any advice on the local property market, please do not hesitate to contact me as I am always happy to help.