All landlords are property tycoons with deep pockets?

All landlords are property tycoons with deep pockets?

9:45 AM, 17th December 2021, About a month ago 34

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Proposals to force landlords across the country to pay up to £10,000 to improve the energy efficiency of rental properties requires a rethink, according to the national body for landlords.

In a consultation which closed in January, the Government proposed that by 2025 all new tenancies in the private rented sector should be in houses with an Energy Performance Certificate rating of C or better. It is proposed that this standard should apply to all private rented properties by 2028.

As part of this the Government has suggested that, in meeting these targets, landlords should be expected to pay up to £10,000 to make the necessary improvements.

Whilst the sector is still waiting for the Government’s response to this consultation, the NRLA is warning that the planned cap is based on a misguided assumption that all landlords are property tycoons with deep pockets.

NRLA research shows that private landlords make an average net income from property of less than £4,500 a year.

Recent figures have shown the scale of the problem the sector faces in meeting the Government’s ambitions. Across England over 58 per cent of private rented households have an energy rating below a C. Around a third (32 per cent) of private rented homes were built prior to 1919, some of the hardest to improve housing in the country.

The National Residential Landlords Association is calling on the amount that landlords should be expected to contribute to be linked to average market rents in any given area (known as broad rental market areas) as calculated by the Valuation Office Agency. Under the NRLA’s proposals this would mean the amount a landlord would need to contribute would gradually taper from £5,000 to £10,000, taking into account different rental values (and by implication, property values) across the country.

Alongside this, the NRLA is calling for a package of fiscal measures to support investment. This should include the development of a decarbonisation tax allowance, no longer applying VAT to energy efficiency and low carbon work and not charging council tax where energy improvements are being made to rental properties when they are empty.

Ben Beadle, Chief Executive of the National Residential Landlords Association, said: “We all want to see as many energy efficient rental properties in the sector as possible. Besides being good for tenants, improvements made to rental properties ensure they become more attractive to prospective tenants when being marketed by landlords and agents. However, the Government’s proposals for the sector are not good enough.

“They rely on a misguided assumption that landlords have unlimited sums of money and fail to accept the realities of different property and rental values across the country.

“Ministers need a smarter approach with a proper financial package if they are to ensure their ambitious objectives are to be met.”



Comments

by rod.townson@yahoo.com

14:11 PM, 18th December 2021, About a month ago

Wow. For something which has not been confirmed the proposed changes to the MEES/EPC requirements have certainly got most of you very vocal.
iHowz landlord association wrote to Kwasi Kwateng back in August. The response from the DBEIS can be seen here https://ihowz.uk/the-anticipated-standards-for-the-minimum-energy-efficiency-standards-mees/
It's a shame that many landlords regard investment as cost. If you were to buy your property off another landlord, you would probably give it a facelift and at a minimum insulate lofts and replace doors and windows, if they were not already thermally efficient. You would also take a look at the heating and ensure heating controls were updated, even if the boiler still had a few years' life.
That said, I am not sure why you would spend £17,000 on external wall insulation when the current cap of £5,000 would exempt the requirements to carry out these works (unless you have 4 or more flats in the property, or you thought it would increase the value of your property).
IHowz landlord association also attended the consultation meetings on the update to the MEES requirements and how they would impact EPCs. We highlighted the current bias against electric heating solutions and suggested many of the fiscal measures highlighted in the main article. We also asked that measures should take into account the payback period of the energy savings.
The recent price hikes for gas may help even the case for electric based heating from a cost perspective, especially if carbon pricing and carbon reduction are taken into account.
In the meantime, I can confirm that heat recovery vents work wonders in properties with a history of damp and mould.
Those of you who house tenants on benefits in properties with an EPC of less than C may actually want to talk to the council as many locall authorities will carry out works for free using the redirected Green Deal funding under a scheme called LAD
https://www.gov.uk/government/publications/green-homes-grant-local-authority-delivery-scheme-entering-a-bid
Failure to bring your homes up to standard may cost you when you come to remortgage or insure your property, as providers bring energy efficiency into their criteria.

by Suresh Parikh

15:24 PM, 18th December 2021, About a month ago

Reply to the comment left by neilt at 17/12/2021 - 13:37
Hi
Your proviso "with adequate ventilation" is important.
Many tenants will not ventilate: to save on energy.
Nor will they wipe dry or heat: hence, lifestyle damp etc.
Victorian houses have solid bricks, so you cannot have cavity wall insulation. To install insulation boards all along the walls, ceiling, and perhaps flooring decreases the size, and again encourages the tenant's lifestyle damp.

by Helen

15:45 PM, 18th December 2021, About a month ago

I agree with the landlords above who, like me, have older properties. How they are used really affects condensation issues. One flat had terrible damp as the tenants packed bags and stuff against most of the walls. This was after I had made a partition wall as there was no cavity insulation. They did not heed my advice to move things away from the walls. The following two sets of tenants have had less stuff, nothing pushed against the walls, and it has been fine.
On the issue of spending upwards of £10K per property I absolutely cannot afford this. Income after expenses per flat is around £4.5K, if I am lucky.
I would love to help the environment, and I do in my own home, and with my life style, but I can't afford to do these measures across my 8 flat portfolio.
The government should enforce these measures over a much longer time period, to allow for the technology and expertise to improve and get cheaper. Also it is imperative that they put their own house in order first, as it were. Council and Social Housing is often the worse in the country and currently has no regulations even to meet the PRS 'E' statutory rating.

by Helen

15:45 PM, 18th December 2021, About a month ago

I agree with the landlords above who, like me, have older properties. How they are used really affects condensation issues. One flat had terrible damp as the tenants packed bags and stuff against most of the walls. This was after I had made a partition wall as there was no cavity insulation. They did not heed my advice to move things away from the walls. The following two sets of tenants have had less stuff, nothing pushed against the walls, and it has been fine.
On the issue of spending upwards of £10K per property I absolutely cannot afford this. Income after expenses per flat is around £4.5K, if I am lucky.
I would love to help the environment, and I do in my own home, and with my life style, but I can't afford to do these measures across my 8 flat portfolio.
The government should enforce these measures over a much longer time period, to allow for the technology and expertise to improve and get cheaper. Also it is imperative that they put their own house in order first, as it were. Council and Social Housing is often the worse in the country and currently has no regulations even to meet the PRS 'E' statutory rating.

by Pixie Props

17:20 PM, 19th December 2021, About a month ago

EPC's should be better administered and its operatives better trained. I remember when they first started, the inspector would arrive with steps to look in the loft. not now though.

I have done extensive refurbishments insulating floors and walls but when it comes to EPC time the inspector rejects even photos as proof if the works aren't done by authorised companies and so they tick the 'Assumed no Insulation' and give no recognition. Reaching 'C' and above is uphill lifting under these conditions.

by Beaver

11:21 AM, 20th December 2021, About a month ago

Reply to the comment left by at 18/12/2021 - 14:11
Question for Rob Townson:

On "In the meantime, I can confirm that heat recovery vents work wonders in properties with a history of damp and mould."

Do you have any more information on 'heat-recovery-vents"?

by rod.townson@yahoo.com

11:55 AM, 20th December 2021, About a month ago

Reply to the comment left by Beaver at 20/12/2021 - 11:21
Sorry, agents arranged for me, so can't tell you what was fitted.
From memory, the main things to consider are: efficiency (% heat recovery),
operating noise and
energy usage

For an independent view, try NSBRC or one of the energy saving charities

by Smiffy

12:10 PM, 31st December 2021, About 4 weeks ago

About the only bonus of benefit supported tenants, is the subsidies they can get.

Over the years I've had 2 older solid wall properties externally clad with a subsidy of around 80%.

Numerous lofts insulated FOC.

A boiler replaced, which my contribution was £160,

And a couple of months ago, £4.5k of storage and panel heaters replaced, FOC.

I should add, all the tenants involved are long standing, previously working tenants who ended up receiving benefits due to retirement or health issues

by DSR

13:17 PM, 2nd January 2022, About 3 weeks ago

Reply to the comment left by Paul landlord at 17/12/2021 - 17:28
sounds you are in the same position as myself. I am slowly upgrading as I go (when tenants move out before next ones move in). I suppose we just have to wait and see what the government dream up next for us when they plan the C rating EPC push.

I'm worried if I spend now and still only achieve a D by 2025 or 2028, are the government going to accept the cost of the improvements spent in 2019, 2020, 2021 and so on at the point this becomes law, or are they going to say improvements made (up to the value of £3.5 now or £10k as proposed) can only go back say 3 years before 2025/2028?

In other words, do I hold fire on any other improvements on any other properties till the end of this year (2022) so I can use these as proof of the spend for the purposes of attaining the C???

by Landlord DEA

11:00 AM, 16th January 2022, About A week ago

I believe that the article has got the dates slightly wrong. The new EPC 'C' standard does not come into effect until 2035.
2025 refers to the standard coming up to 'D' (from the current 'E') and all existing lets a 'D' by 2028.
I know a little about this because I've been producing EPCs since 2007, HIPs back in the day and an EPC upgrade service for landlords as of now.
With regard to landlords being obliged to spend out to meet the new standards (I'm a landlord myself), the problem is that the government are very keen that landlords stick to a 'fabric first' policy i.e. wall insulation - which is very expensive for solid brick. Whereas quite often, the most affordable measures to make standard are elsewhere.
Worse, the vagaries of the EPC algorithm mean that quite often, the most affordable EPC upgrade does not even appear on the EPC. I've seen this enough times that, as a result, I'm offering an EPC upgrade service to landlords to point this stuff out. It'll save landlords quite a bit and do me a favour too.
For some reason, my profile isn't taking my url. But you can check it out yourself at https://www.epcupgrade.com/


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