New EPC regulations, imposing stricter requirements to EPC ratings of rental properties in the UK, have been delayed until 2025
The delay in imposing new regulations has been sparked by technical difficulties affecting the UK government’s EPC database. Resulting in landlords not needing to comply with the new regulations until 2025 at the earliest.
Whilst the delay might be received positively by landlords, who will now be able to spread the cost of property upgrades over a longer time period, there are some negative repercussions for tenants. According to an article in the Guardian, tenants in the UK are predicted to face over 1bn in gas and electricity costs caused by this delay, as they remain in homes which are not built to be energy efficient.
Recap: Why are new EPC regulations being imposed?
The main driver for new regulations comes from Government sustainability initiatives to reduce energy usage by mass-scale in homes across the UK. However, there are many positives for landlords and tenants which come from the new regulations.
Tenants will pay less - Poorly insulated properties (or properties which are not made to be energy efficient) can lead to 21% higher energy bills.
More sustainable - The carbon footprint of a typical rental property is 19% higher than that of an owner-occupied home.
Charge higher rent & attract better tenants - According to a recent survey, 90% of tenants believe that energy-efficient homes are essential, and 82% would be willing to pay higher rent for such properties.
Landlords should not waste time during the delay in imposing the new regulations. Instead, landlords should see the delay as an opportunity to plan further ahead, conduct more research on contractors and to spread the cost over a longer period of time to avoid paying large fees. For landlords with multiple properties in their portfolios, the change will mean they can make upgrades to their properties slowly, without rushing all at once.
Whilst the upgrades may be expensive initially, there’s a lot of benefits beyond compliance with the new regulations. Making energy-efficient upgrades can save landlords an average of £350 a year on energy bills, and upgrading from an EPC rating of D or E to an A or B can add an average of £16,000 to a property's value.
The delay in implementing new EPC regulations is a significant setback in the UK's efforts to achieve its goal of net-zero emissions by 2050. However, landlords can still make a significant impact by taking action early to improve the energy efficiency of their properties and make the transition easier by spreading the time (and effort) over the coming couple of years.
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