Legislation Update – EPC and Rental Reform
As we near the second half of 2023, there have been some interesting updates regarding perhaps the two biggest topics of conversation for Residential Landlords and Investors in Buy To Let property.
Energy Performance Certificates
The Government Bill concerning changes to the Minimum Energy Efficiency Standards, which we previously wrote about when in the consultation phase – Read Here is one step closer to coming into force, having had its second reading in Parliament on the 24th March 2023. Whist still not fully legislated there are some key changes to the initial Bill.
The first is concerning the date that the changes will come into effect, all tenancies for privately rented property “must be at least EPC Band C from 31st December 2028 where practical, cost-effective and affordable”. It will be down to the Secretary of State to define what “practical”, “cost-effective” and “affordable”.
This is a slightly better outlook than before, as originally the Bill had a deadline of 2025 for new tenancies, which has been removed, with both new and current tenancies now having a deadline of 2028.
Whilst not directly related to the private rental sector, something else which may have a knock on effect, is that the bill requires mortgage lenders to ensure that “the average energy performance level of their domestic portfolios is least EPC Band C” by 31st December 2030. It may therefore prove more difficult and possibly more expensive to obtain a mortgage on a property with a lower energy efficiency rating.
As above, whilst this is not law yet, so we could see further changes before the bill is passed. We will keep you updated as things progress.
Rental Reform Bill / Abolition of Section 21
After a long wait, Michael Gove, Secretary of State for Levelling Up Housing and Communities has said that the rental reform bill will be introduced in Parliament this week. We wrote about the White Paper which was released in June 2022, and you can read our article here.
Having been deemed the “”the biggest shake-up of the private rented sector in 30 years”, it is clearly something that all tenants, landlords and agents are going to be keenly interested in following as the Bill moves through parliament. Whilst there are many aspects to the reform, one of the main proposals is the abolition of Section 21, which could, if not done correctly, cause widespread issues for all concerned.
We will be following this with interest, especially to see what proposed changes are made to allow landlords to ensure that they can get possession of their properties should they need to for valid reasons, as without this, there will be a real reluctance to provide much needed rental properties to the market.
Stay tuned for further information!
As always, if you would like specific advice on any aspect of residential lettings, please give Andrew or Chris a call on 01284 702 626
