In 2018, all landlords in the private rental market will have to meet stringent new regulations concerning energy efficiency. And although compliance isn’t required until April 2018, there are already some implications taking effect. So what does it mean for both existing and potential landlords?
From 2016, tenants can require landlords to make reasonable improvements to the energy efficiency of their home, where there is financial support available, for example, from the Green Deal which provides government funding to finance the installation of green technologies. Landlords can, however, refuse if it means a financial outlay beyond the funding.
However, by April 2018, all private rented properties must be brought up to a certain energy efficiency level. After that time, it will be illegal to rent out a property which is non-compliant. Where tenants are already living in a property, the landlord has until 2020 to complete the improvements.
Every property currently has an Energy Performance Certificate, rating the property between category A (the most efficient) and G (the least efficient). In 2018, the minimum acceptable standard will become category E.
A landlord’s first consideration should be the availability of government funding to support the necessary improvements, where a property is currently rated as F or G. The Green Deal is worthwhile – because it comes in the form of a loan which is repaid through the property’s energy bills, it will therefore be repaid by the tenant, making the outlay for the landlord negligible. Tenants themselves can apply for this with their landlord’s consent.
Another source of funding is the Energy Company Obligation which is available to finance insulation and boiler replacements if the tenants meet certain requirements – namely, they are in receipt of benefits or tax credits. So with the new regulations in the offing, it makes sense to talk to tenants now and agree a way forward – remember that an energy efficient house is more attractive to your current tenants.
Landlords buying a new property in Wirral will not need to worry about this as there are no improvements. You will have state-of-the-art energy efficiencies, and your investment future protected. It makes sense. It saves money. So give it some thought.
Find out more about purchasing a new build buy to let in Wirral