The Energy Performance of Buildings Directive (EPBD) came with the very best intentions to dramatically reduce the amount of energy consumed by our homes. But as with so much EU legislation, the unintended consequences could be catastrophic for landlords and the letting industry, and with less than two years to go before landlords will not be permitted to let properties with an EPC Rating of F or G, time is fast running out to take action.
Since 2012, residential premises have been graded A to G and given a controversial Energy Performance Certificate based on their energy efficiency with the vast majority of properties falling somewhere in the mid-point or below. From April 1, 2018, it will be unlawful to let a property that does not meet the minimum criteria for energy efficiency, and that means there is going to be a problem.
Apart from some small tinkering at the edges, there are no major grants or initiatives from Government targeted specifically at Landlords to help them bring their properties up to spec.
Landlords, especially those with larger portfolios, are unlikely to want or be able to invest the sums of money required to regenerate their properties. Tens of thousands of properties could be affected, and tens of thousands may be dumped on the market as a result. Investors will not want to buy properties that they cannot let, and the shortage of residential properties available to rent – a number that is already critically low – will become even more acute.
The unintended consequence of the new law could well be the creation of new slum areas, with properties that are in effect un-lettable and uninhabitable. Sink Estates, which the Prime Minister has vowed to tackle with £140 million of investment, could become larger in number, with all of the social depravation and misery that brings.
EPBD is the elephant in the room, and will not only affect residential properties but also, in time, commercial estates. It is an elephant that the industry, and our professional bodies, need to be confronting urgently with their biggest guns.