Landlords Guide to EPCs

A Landlord’s Guide to Energy Performance Certificates

Landlords - are you ready for EPCs?

From 1st October 2008, all rental properties with a new tenancy in England and Wales will be required to have an Energy Performance Certificate (EPC).
Why should you care?
Because your prospective tenants will be able to see at a glance how energy efficient and environmentally friendly your properties are. If you have invested in energy saving measures your properties will perform well and will really stand out from the crowd. If not you may find them harder to rent out in future.

What is an Energy Performance Certificate?

EPCs look similar to the energy labels found on domestic appliances such as fridges and washing machines.
The energy efficiency and environmental impact of your property will be rated on a scale from A-G (where A is the most efficient and G the least efficient) as shown below. Current running costs for heating, hot water and lighting will also be shown on the certificate, together with a list of recommended energy saving improvements.

How do I get an Energy Performance Certificate?

Either yourself or your letting agent will have to commission one from an accredited Domestic Energy Assessor (DEA). They will visit your property to assess the age, construction and location of the property as well as its current fittings such as heating systems, insulation, double glazing etc. DEAs can be found in local directories or via
www.hcrregister.com/FindAssessorInspector

How much will they cost?

The cost of an EPC will vary. At the moment average costs range between £40 - £120, so it’s worth shopping around.

When do I need to get one?

It is recommended, especially if you have a reasonably high turnover of tenants, that you don’t wait until you have a vacancy after 1st October 2008 but get an EPC as soon as possible, to ensure that you comply with the law when it comes in. If you don’t have one after that date you could be fined £200 for non compliance. The EPC will remain valid for ten years.

What can I do to make my energy rating as high as possible?

• Insulating your property is the most cost effective measure you can take. In most cases
cavity wall insulation is straightforward, inexpensive and hassle-free. Installing new loft
insulation in most properties is an easy DIY job and should be done to a depth of 270mm.
• If your boiler is over 15 years old it’s probably time to replace it and you’ll get a better rating if you combine it with modern heating controls. If you need to save space, buy a
combi boiler, which does not store hot water in a tank but heats water directly from the
cold water mains as it is used.
• Fit a hot water tank jacket.
• While double glazing can be fairly expensive, it will reduce
noise and lower heating bills.
• When purchasing new appliances look out for the Energy
Saving Recommended logo, and choose the most energy efficient
in their category.

For free, impartial advice on energy efficiency improvements call 0800 512 012 or visit
www.energysavingtrust.org.uk

Are there grants to help cover installation costs?

There are several grants available that can cut your costs by half or even to zero! Visit
www.est.org.uk/myhome/gid to see if you are eligible.

If your tenants are in receipt of certain benefits you may be able to get your property insulated at a significant discount or even for free. Visit www.warmfront.co.uk (England) and www.heeswales.co.uk (Wales) for further information.

If you have insulated your properties you can also reduce your income tax by claiming under the Landlords Energy Saving Allowance. Visit www.hmrc.gov.uk/budget2004/revbn31.htm for further information.

Why is the Government introducing EPCs?

Domestic energy use accounts for 27% of the UK’s carbon dioxide emissions. The Government is introducing a number of energy saving initiatives, including EPCs, aimed at making all buildings more energy efficient. These measures are being applied across all European Union countries as per the European Directive for the Energy Performance of Buildings.

Where can I find out how energy efficient my properties are now?

The Energy Saving Trust will provide you with a personalised Home Energy Check report on each of your properties for free. Simply complete the questionnaire* today and you should have your report very soon. Alternatively, visit www.energysavingtrust.org.uk for more information.

*Available online at www.energysavingtrust.org.uk/proxy/view/full/165/homeenergycheck

Further information
www.homeinformationpack.gov.uk
www.energysavingtrust.org.uk
www.hipassociation.co.uk
www.communities.gov.uk/epbd

Energy Performance Certificate Helpline: 0845 365 2468
This factsheet has been produced by the Energy Efficiency Partnership for Homes, an independent voluntary network funded by government and facilitated by the Energy Saving Trust.

Government's response to petition

Details of Petition:
"The Home Information Pack, (H.I.P.) when fully implemented, will avoid vast amounts of wasted time, effort, money, and failed transactions in the area of property purchase. The packs will also bring an important focus to the issue of energy conservation, which, given the impact of global warming and carbon emission on the planet, should matter to all of us. The full pack has the support of 'Which?' magazine, which ONLY has the best interests of the consumer at heart. Show your support for the H.I.P, and ignore those with a vested interest in maintaining the current 'status quo'."

Response:

"Home Information Packs (HIPs) have been successfully introduced and now apply to most residential property sales in England and Wales. The provision of up-front information in HIPs is already delivering benefits for consumers. Search costs are falling and buyers are now getting real information about the likely running costs of a future home, helping to cut energy bills and carbon emissions."

Estate Agents & EPCs

First day marketing during a temporary period ending on 1 June 2008
Provided that the pack has been requested in writing (and is accompanied by the appropriate payment or an undertaking to make the payment) and it is expected to become available within 28 days – marketing can start without a Pack. The duty to provide a Pack does not then arise until the energy performance certificate (EPC) is obtained.

Once the EPC is obtained, you should ensure that the Pack is made available as soon as possible. At this point the pack must include at least the following documents:

• Index
• EPC
• evidence of title (if registered)
• sale statement.

The Pack might still exclude the following required documents at this point if these have not yet been obtained:

• evidence of title (if unregistered),
• searches
• leasehold/commonhold information

In such cases you should continue to make reasonable efforts to obtain the missing items and add them as soon as possible. Following the end of the temporary period, the main duty is to have a Pack that complies with the Regulations in your possession or under your control when any marketing activity occurs, including marketing activity carried out before the property is actually put on the market.

1 June 2008 onwards
The temporary period ends on 31 May 2008. So from 1 June 2008, there must be a Pack available when marketing starts and certain documents must be in the Pack. Marketing with an incomplete Pack may take place if documents have been requested and it is expected that they will become available within 28 days of the start of marketing. Where documents are missing, this should be noted in the Pack Index and reasonable efforts should be made to obtain them as soon as possible. This exemption only covers the following documents:

• Searches
• Leasehold and Commonhold information
• Evidence of Title (for unregistered properties only)

You are under a duty to provide a copy of the Pack (or any part of it) to a potential buyer who asks for it. The only exceptions to this rule are where it is believed that:

• The person making the request could not afford the property in question
• The person making the request is not really interested in buying the property
• The potential buyer is not a person to whom the seller would wish to sell the property.

However, this does not allow the responsible person to unlawfully discriminate against anyone. A reasonable charge to cover copying and postage costs can be made for providing copies.

You will be expected to make sure that the right documents are included in the Pack, but the legislation on Home Information Packs is not intended to provide that the seller or the seller's estate agent should be held responsible for the accuracy of the information contained in documents that have been provided by others. The penalty provisions recognise this, and will not apply so long as the seller or the seller's estate agent has reasonable cause to believe that the document does comply with the Regulations.

From 1 August 2007, estate agents marketing with Home Information Packs will have to belong to an independent Redress Scheme approved by the Secretary of State. You can find out more on our page on Complaints Procedure.

Properties marketed before the commencement date
Properties that are genuinely on the market before the commencement date (i.e. 10 September for sales of homes with three or more bedrooms) will not need a Pack. This exemption will apply for as long as marketing continues but the Government may appoint a date at which all properties on the market will be subject to the HIP duties, regardless of when they were first marketed.

Penalties and enforcement
The Pack duties will be enforced by local authority Trading Standards Officers. They will be able to give advice and warnings, as well as issuing penalty notices. The fixed penalty has been set at £200 initially, and can be repeated if a breach is repeated. Marketing a property without a Home Information Pack, or an incomplete Pack, will render an estate agent liable to a penalty notice.
Estate agents should also be aware that a breach of the Pack duties will be treated as an 'undesirable practice' under the Estate Agents Act and must be notified to the Office of Fair Trading (OFT) as such. An estate agent who consistently flouts the Pack duties will therefore risk a banning order from the OFT.

Extracted from http://www.homeinformationpacks.gov.uk/