What are EPC ratings?

Much like the multi-coloured sticker on new appliances, EPC ratings indicate how energy efficient a property is, giving it a rating from A (very efficient) to G (inefficient).They also demonstrate the environmental impact of a property in terms of carbon emissions and how costly it will be to heat and light, both in monetary and CO2 terms.

From April 2018, it will be unlawful under the Energy Act 2011 to let a residential property on a new contract with an EPC rating of F or G – the lowest two categories. This will not apply to existing lettings until 2023, however there are potential, and significant, implications for landowners with large and growing portfolios of residential lets, particularly those with older properties that have not had the benefit of recent improvements.

In addition, from April 2016, tenants living in F and G rated homes will be able to request that their landlord takes measures to improve the energy efficiency, with the landlord duty bound to respond within a month with a view to bringing the property up to the minimum E rating.

Landlords can best prepare by acting sooner rather than later to gain an understanding of the energy efficiencies of their let property assets. 

The first step is to instruct an approved EPC assessor to survey each property and establish the current rating. If the rating is less than an E, the assessor will be able to advise on how to improve it. This could be as simple as installing energy saving light bulbs and draught proofing or making more comprehensive improvements, such as replacing an ageing boiler, putting in secondary glazing or upgrading heating controls, and installing systems which are likely to have a impact on improving overall energy efficiency.

The next step is to set out an action plan and phased work schedule to tackle let properties that fall short of the mark.

Taking action now will mean landlords have time on their side to schedule the works and budget costs accordingly, with the ability to spread the outlay over the forthcoming years.

Further information

For more information and advice contact Savills Lettings or Savills Estate Management Consultancy.