Changes to energy efficiency rules could lay a heavy burden on landlords

Landlords are being advised they cannot afford to ignore changes to energy efficiency laws, as debate continues about the likely impact of reforms on the rental sector. A new set of standards, scheduled to take effect in April 2018, will mean that it is illegal to rent out a property with an energy efficiency rating of ‘F’ or ‘G’, unless the landlord has a valid exemption under the Minimum Energy Efficiency Standards.

The requirements will impact on as many as 330,000 buy-to-let homes around the country, with the Residential Landlord Association (RLA) having warned that the changes may push up rents.

Under the current system, landlords are only required to carry out any improvements to a property that can be wholly paid for with money made available under the Energy Company Obligations (ECO) scheme. However, this initiative is to be overhauled between 2018-2022 and there are concerns that funding for the private rented sector may no longer be available.

This could mean that landlords will struggle to secure the necessary funds for energy efficiency work and to meet the new requirements they may be left with little choice but to increase tenants’ bills.

Richard Jones, from the RLA, said: “Whilst we all want to see improvements in the energy efficiency of homes to rent, that cannot come at the expense of driving up rents.

“The Government’s proposals will amount simply to another tax on tenants.”

In a statement, a spokeswoman for the Department for Business, Energy and Industrial Strategy said it was considering a range of options as regards the implementation of the Minimum Energy Efficiency Standards.

For advice on this and other Residential Property issues, please contact Partner and Head of Residential Property Chris Pease.

Please note the contents of this blog are given for information only and must not be relied upon. Legal advice should always be sought in relation to specific circumstances.