In 2018 landlords will be required to comply with new energy laws or face financial penalties. Will this affect you? If so, we’ve got the lowdown on the new energy efficiency standards and what they mean for UK landlords.
Enforced energy efficient standards
Under the new laws landlords will have to ensure that their property complies with minimum energy efficiency standards before handing over keys to a tenant. While some exemptions will apply, the new laws will affect the majority of British landlords.
Neil Sagoo, partner at Maples Teesdale law firm explains, “These regulations are likely to have a big impact on the private rented sector. They are presenting a straightforward ultimatum: bring your properties up to scratch in terms of energy efficiency, or risk losing income.”
Power to the tenants!
Adding to the UK’s energy efficient efforts is a new Tenant’s Energy Efficiency Improvement Regulations scheme. Set to be rolled out on April 1 2016, the regulations will give tenants the power to lodge energy efficient improvement requests with their landlords.
While the consequences of non-compliance have not yet been revealed experts are predicting that they will be severe. One of the most popular theories is that financial penalties will be determined by the amount of rent earned while in violation. Furthermore, landlords that fail to play by the rules could be court ordered to make eco-friendly changes as required. At the end of the day, landlords will be forced to improve energy efficiency or face the consequences.
New lettings will be subject to the regulations from April 2018 onwards while existing rental properties will be offered a little more leeway, with the current deadline set for 2023.
“This means that landlords can no longer pay lip service to energy efficiency. Whereas it was once a worthy aspiration, it is becoming as fundamental as fire safety or building regulations and is to be ignored at your peril,” adds Sagoo.
While the new energy standards are supposed to have a positive impact on the environment, economic and housing experts fear that they could jeopardise the state of the UK’s rental market. In worst case scenarios landlords who can’t afford to make the upgrades could be forced to evict tenants or run the risk of financial penalties.
With energy costs on the rise and financial penalties in place for non-compliant properties, landlords simply can’t afford to fork out unnecessary cash. From unpaid rent and contents damage to fire, floods and other weather related disasters, taking out a comprehensive landlord insurance policy is a critical part of keeping landlord costs to an absolute minimum.