When Minimum Energy Efficiency Standards (MEES) came into force on 01 April 2018, it became illegal to let or renew an assured tenancy on a domestic property in England and Wales rated F or G on the EPC – unless you registered and qualified for an exemption.
From 01 April next year, that rule applies to all properties. So, if your Buy to Let is still currently rated F or G, you’ll need to make energy efficiency improvements or register a valid exemption before April 2020.
- Check the EPC to see what changes are recommended to raise the rating
- If your property has to be reassessed we can help find an energy assessor for you and if you can’t find your copy, you can also check whether it’s listed on the register and download it for free
The big news for this year is that there have been changes to the rules around the cost of funding improvements and the conditions under which you can register a valid exemption. These took effect on 01 April 2019
- A personal ‘spending cap’ of £3,500 (including VAT) has been introduced, so you don’t have to spend any more of your own money than that on energy efficiency improvement works
- A ‘high cost’ exemption has also been introduced. If it would cost you more than that to bring an ‘F’ or ‘G’ rated property up to standard, you must simply do as much as possible for £3,500, then register an exemption
- This cap only applies to your own personal spend. If you’ve got a grant or other form of funding to help with the cost of making improvements this does not count towards the £3,500 limit
- The ‘no cost to the landlord’ exemption is ending on 31 March 2020. This means that if you currently have an exemption based on the fact that you were unable to fund energy efficiency improvements, this will no longer be a valid reason
- The ‘consent exemption’ has also been removed. It used to be the case that if a sitting tenant withheld consent to a Green Deal finance plan, you could register an exemption on those grounds. This will no longer apply
- If you breach any of the MEES rules, your local authority can fine you up to £5,000. This could be made up of various fines, including:
– Failing to comply with a council issued compliance notice: up to £2,000
– Breaching regulations for three months or more up to £4,000
– Entering false or misleading information on the PRS Exemptions Register: up to £1,000
- These changes mean that you may now be forced to spend £3,500 on improvements, whether that’s affordable or not
- In reality, it’s unlikely to cost you anywhere near £3,500. According to Which? it costs an average of £1,200 to upgrade older properties to an EPC grade E
If you would like to discuss any of the points raised above, book a lettings review with one of our expert lettings managers.