Landlord’s EPC deadline: Does anyone else feel conned?

Landlord’s EPC deadline: Does anyone else feel conned?

10:54 AM, 28th July 2023, About 9 months ago 48

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Have you invested thousands of pounds to upgrade your rental property to meet the proposed EPC rating of C? Or have you decided it’s too expensive to do the work and sold up? Then this week’s news from Michael Gove probably made you very angry. I know I was. In the words of the great Johnny Rotten: “Ever get the feeling you’ve been cheated?”

It’s not just the number of idiots who keep pushing the non-existent deadline of 2025 to meet a minimum EPC rating of C for new tenancies, and 2028 for all tenancies – THERE IS NO DEADLINE! – it’s the fact that many of us girded our loins and started preparing for what we expected was to come.

Now Property118 reports that Gove is saying we should slow down the move to a deadline because too much is being asked of landlords and the predicted cost of improvements. What?

In recent years, the UK government has pushed forward with its environmental agenda, with the Energy Performance Certificate (EPC) rating being one of the cornerstones of its efforts to reduce carbon emissions.

Despite the fact this proposal was only aimed at the private rented sector and not social housing and residential homes, most landlords knew deep down that we would be targeted with fines if we didn’t comply. So, many of us did.

Upgrade their properties’ EPC rating

There will be lots of landlords who will have spent considerable sums of money to upgrade their properties’ EPC rating or, in some cases, sold their properties altogether to avoid the never-agreed-but-everyone-thinks-there-is-one deadline. Now, with the government contemplating a rethink on when this should happen, landlords who are out of pocket will be left questioning the fairness and reliability of the whole process.

For me though, the biggest tragedy is for those landlords who had old homes and sold up, probably with a decent tenant family, because they knew it was an impossible task to improve the EPC rating. A family forced to move on, for what? A landlord who gave up an asset on a poorly thought-out wheeze.

I don’t doubt addressing climate change and reducing energy consumption is essential. As responsible citizens, landlords, like everyone else, should contribute to these noble goals. Nevertheless, it is crucial to address the issues arising from the government’s flip-flopping stance on the EPC deadline.

The 2028 deadline was an ambition

When it was first mooted, landlords came under immense pressure to upgrade their properties. This was not helped by various PRS organisations and even lenders who hadn’t quite twigged that the 2025 then 2028 deadline was an ambition and not a law.

This has created lots of confusion in the sector and led to many landlords investing significant amounts of time and money to improve the energy efficiency of their properties, only to now be told that the ‘deadline’ might be reconsidered. This inconsistency showcases a lack of commitment on the government’s part and raises doubts about the seriousness of their climate change policies.

Also, the cost burden of improving the EPC rating falls solely on the shoulders of landlords. These expenses can be substantial, especially for small-scale landlords who own one or a few properties. Selling up then made financial sense even though that leaves fewer homes to rent.

EPC ratings have been criticised for their accuracy

My other big issue is that the EPC ratings themselves have been criticised for their accuracy and effectiveness. Just read some of the forum answers on Property118 which highlight many landlords’ experiences that the EPC rating system is flawed and inconsistent – which leaves most of us with a lack of faith in the validity of the entire process. And the criteria for future EPC ratings might be changing! You couldn’t make it up.

If the government is serious about driving real change, they should work on developing a more robust, reliable and transparent system to accurately assess a property’s energy performance. And that’s for ALL properties and not just those owned by landlords.

We can’t be the only ones responsible for fighting climate change while other property owners escape the same level of scrutiny.

Forking out thousands of pounds on EPC improvements

So, if you feel disappointed at forking out thousands of pounds on EPC improvements, or you have sold up or feel saddened that decent tenants had been forced to find somewhere else to live, then join the club.

I keep on saying the same thing: We need to organise properly as landlords to make a stand that the government and tenant organisations will be afraid of. Without PRS landlords delivering decent homes for rent, where will private renters live?

The EPC debacle is just one issue we should unite and fight against, but we probably won’t which means life as a landlord will continue being the depressing and soul-destroying occupation it has become.

Conned? Not quite the word I would use but then I’m not allowed to use a word that rhymes with ‘cooked’.

Until next time,

The Landlord Crusader


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Comments

Reluctant Landlord

9:15 AM, 28th July 2023, About 9 months ago

There was always the potential for this to happen, which is why a lot of landlords like myself have not done anything regarding any possible work until something happens where by a repair is needed or something major needs replacing.

With the cost cap requiring evidence to prove any expense for the purpose of meeting the new rating and needing to be date specific, then with no date of EPC rating change, where was the rush?

Unless something is a done deal, then I wont be paying out for anything. U turns a plenty, and it wont be any different under another coloured government! I dont work of 'maybe's these days and certainly not where it involves what could be unnecessary expenditure in the current climate.

John Mac

11:16 AM, 28th July 2023, About 9 months ago

"I don’t doubt addressing climate change and reducing energy consumption is essential. As responsible citizens, landlords, like everyone else, should contribute to these noble goals"

You talked about being Conned in the title - "Climate Change" or more emotively "Climate Crisis" is THE BIG Con.

The Climate has been changing for Billions of years, there is no Climate Crisis, the Gov, aided by the MSM is carrying out a Campaign of fear, they learned how successful these campaigns can be with Lockdowns & mask wearing.

Time to wake up people!

John Hayes

11:19 AM, 28th July 2023, About 9 months ago

Reply to the comment left by DSR at 28/07/2023 - 09:15
I have a block of 4 flats. The 2 ground floor have an EPC of D, the 2 first floor have an EPC of C & E.

They are identical in every respect, just different assessors!!! Until there is some consistency with the EPC rating system then the whole subject is an absolute joke.

Darren Burrows

11:24 AM, 28th July 2023, About 9 months ago

Let's remember here that nothing has actually happened except Gove saying 'we should slow down'. What does that actually mean?

Do you think that he might just have said that to try to get voters on board ahead of the next election? There's nothing to say that the improvements won't need to be done - 2025, 2028, whenever - it's still something that will be addressed.

It is in the best interest of HMO landlords in particular that will benefit from lower fuel bills if they are including fuel costs in rents to tenants.

For vanilla BTL landlords, it will be a benefit too especially when it comes to improvements in wall insulation as it will hopefully help against thermal/cold bridging and could help reduce the numerous damp problems that lots of people seem to be seeing in recent times.

Bottom line, carrying out these works will have further far-reaching benefits to landlords on top of just ticking a compliance box - that's just the catalyst.

There is a cost associated to this, I get it, but it's a simple spend to save exercise and everyone needs to look at the longer term picture I think.

reader

11:25 AM, 28th July 2023, About 9 months ago

Dear Crusader

You make many valid points in particular there are at least three major issues.

Firstly the level of attainment without gas central heating. The C rating is beyond attainment in many pre 1945 solid walled properties. If the D rating was split into D1 and D2 the higher D1 might be achievable.

Secondly, the EPC assessment scheme is often inaccurate. A thorough overall of the means of measurement and the formula they use with the data needs to be achieved.

Thirdly, if the need to provide better homes and the need to reduce a carbon footprint are the objectives why are the proposals merely being imposed on private rented accommodation. All homes both rented (both public and private) and owned need to be subject to the same standards.

Robert

11:26 AM, 28th July 2023, About 9 months ago

I remember talking to a fellow landlord last spring (2022) before the current rental crisis. They felt the government would back down for landlords with existing tenants. If they were to fine the landlord, the landlord would maybe have to evict the tenant to get works done. The tenant may and try to block eviction, which the court may uphold. This is made worse with abolition of no fault evictions; we get a Catch 22 situation. The shortage of properties is far worse now. After a decade of hitting the PRS, and now with higher interest rates, basic economics has kicked in with lower supply leading to higher rents. The EPC initiative will only exacerbate this situation.

Chris Rattew

11:27 AM, 28th July 2023, About 9 months ago

I looked at the bill. The dates are there, but not a lot of the other information rumoured in the media. If all we hear is true, the bill is completely unworkable, so I am ignoring it. However, We expect about half our rental income over the next few years will be spent on measures that reduce carbon emissions. Where this is done will depend on repairs and improvements that are needed. We cannot in any case meet the date of 2028 for all three of our buildings, and probably none for 2025. We also expect to make no withdrawal of income from our lettings over the next few years after mortgage costs and tax, as we receive pensions.

Hedley

11:29 AM, 28th July 2023, About 9 months ago

An example case (a true one). A 150 year old stone built terraced cottage which I refurbished in 2006 to then full current building regulation standards. This included digging out the ground floor, inserting insulation and re-flooring, roof insulation, new heating system, full duble glazing, new electricals and fittings. It was susequently assessed as C for EPC requirements.
Down the road with the need to renew the EPC it was downgraded to D. The assessor had ticked his box to say it was a suspended timber ground floor and when questioned (although he had been given a copy of the specification for building regulations showing that it had a solid insulated floor) he said he couldn't see it and didn't have a box for that type of floor anyway.
What is the point of doing the work early if assessors are either unable to do a proper job because their ipad app is flawed or are stupid. In addition the rules might change anyway.

Denise G

11:30 AM, 28th July 2023, About 9 months ago

Reply to the comment left by DSR at 28/07/2023 - 09:15We are the same - which means that the planned improvements we would have made by now still haven't been actioned - because we were hanging fire to see how much of / or if any of the costs of those improvements we would have (arguably should have) made would be allowable against any threshold the government might decide at some point to set against costs to meet their 'deadline'.
The net result of this debacle for us (and for our tenants) is that our properties are actually LESS energy efficient, LESS warm and/or LESS climate friendly than they would have been without this ill-considered nonsense looming over us for years!

Paul Chetwyn

11:39 AM, 28th July 2023, About 9 months ago

Yes I am completing as we speak on a sale sold partly because of EPC and capital gains tax changes together I may as we sell now.
That’s one sold two years ago £30k loss another sold last year and now one sold this year, this years brought on by the added factor of the capital gains! I didn’t want to sell any more just yet!
I now wonder what will happen next year to make another re-think and sale !!!!

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