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New obligations for EPCs

RLA
Written by RLA

The duty to produce an EPC on a property being marketed for rent or sale has been quietly changed…

The duty to produce an EPC on a property being marketed for rent or sale has been quietly changed.

Shortly before last Christmas, just as agents were getting ready to pack up for the festive break, it emerged that rules on Energy Performance Certificates were about to change – yet again.

This was both good and bad news. The good news is that earlier obligations have been significantly relaxed. The bad news is that agents were caught on the hop, given virtually no time to implement the changes, which came in on January 9th 2013 and affected their marketing.

The further bad news is that the government department concerned, Communities and Local Government, has given out some very hazy advice.

The biggest changes are:

  • If you are marketing a property for sale or for rent, you no longer need to attach the front page of the EPC to marketing particulars. This earlier requirement was seen as gold-plating the EU legislation.
  • If you are marketing a property for sale or for rent, the graph no longer needs to be shown, but the actual rating does. ‘Marketing’ means property details, all advertising including newspaper adverts, student letting publications, postcards in windows, press releases and, importantly, the internet.
  • Listed buildings no longer need an EPC.

However, as already mentioned, some of the CLG advice is very hazy. For example, while it is clear that the actual energy rating should be shown on particulars and all advertisements, it is not obvious that the need to display the EPC graph really has been jettisoned. The advice says that the graph should be shown ‘where space allows’.

There is also confusion as to what is meant by the ‘actual energy rating’. Some have taken this to mean just the EPC letter – for example, A or D. Others believe it means that both the letter and the number should be used.

There is also a lack of clarity over the guidance on listed buildings. This says that no EPCs will be required where ‘compliance with certain energy efficiency requirements would unacceptably alter character or appearance’.

On the face of it, this means that if an EPC suggests that to make a listed building more energy efficient, the improvement would wreck the qualities that made it listed in the first place, then the EPC is not required. However, this would tie anyone up in knots, and most property experts are taking this to mean that no EPC is required on any listed building.

Yet as far as listed buildings are concerned, owners can still volunteer to have an EPC, and any wishing to access the Green Deal would need to commission one anyway.

What has not changed is the requirement to produce an EPC when you are selling or letting a residential property. Also unchanged is the requirement to show this EPC to all prospective purchasers and tenants, free and as soon as possible, meaning that the EPC must have been at least commissioned before the property goes on the market. Failure do to do so could result in a fine – although there no evidence that Trading Standards officers are actually policing this.

You must also give a copy of the actual EPC to the eventual tenants or purchasers.

Bedsits are still exempt from the need to produce EPCs, provided they share at least one facility such as a bathroom or kitchen.

EPCs also continue to have a shelf life of ten years. For landlords, this means that a rental property that still has a current EPC will only need to obey the new rules once the ten years are up. Properties coming on to the market that have not previously had an EPC will now need one, and the important change is that the EPC rating is now shown in all advertising, including the internet.

What do agents think? Tim Pearse, of Strutt & Parker, says: “The frequent changes in Government policy and lack of clarity on the issue have caused frustrations across the industry. However, the new rules do make life easier as there is less red tape and a simpler format to follow when preparing a property for the market.”

So, how can you be sure you are complying? One (anonymous) lettings expert posted up the following advice on a website. It has had many hundreds of reads – and so far, not one objection from Communities and Local Government:

  1. Commission an EPC the second you market a property that does not already have one.
  2. Be ready and equipped to show it to any prospective tenant in any format they are prepared to see it, electronically if they are happy that way. If not, then you must show them the whole hard copy, but you do not have to give them a copy.
  3. Make sure at least the EPC rating but also the numerical value rating figure appear in all adverts. The guidelines published by CLG and ARLA (and probably others) only bang on about the letter A–G but the Regulations, i.e. the law, require the actual numerical rating as well.
  4. Give hard copy to the eventual tenant: they are the only person entitled to one to keep. Get confirmation from them they have received it: attach it to the inventory so they sign for it.
Further information
This article original appeared in the March/April 2013 edition of Residential Property Investor (RPI), the RLA’s very own industry magazine. Read the online version of RPI now.

About the author

RLA

RLA

The Residential Landlords Association (RLA) represents the interests of landlords in the private rented sector (PRS) across England and Wales. With over 23,000 subscribing members, and an additional 16,000 registered guests who engage regularly with the association, we are the leading voice of private landlords. Combined, they manage almost half a million properties.

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