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PainSmith Solicitors Legal Updates

Energy Performance Certificates in Let Property

SEE ALSO: HIPS are history but EPC's are not - May 2010

SEE ALSO: Energy Performance Certificates for rental property

SEE ALSO: Building Energy Rating - Certificates in Ireland (BER)

and Northern Ireland and Scotland

SEE ALSO: Diagnostic de Performance Energétique - DPE - France

 

by Dr David Smith of Pain Smith Solicitors*

25th September 2008

From 1 October 2008 residential let property will require an Energy Performance Certificate (EPC). The provisions are part of The Energy Performance of Buildings (Certificates and Inspections)(England and Wales) Regulations 2007 SI 2007/991. This can be found in full at www.opsi.gov.uk/si/si2007/uksi_20070991_en_1.

The requirement is set out in regulation 5 which demands that a prospective tenant be provided with an EPC at the earliest opportunity and certainly prior to entering into any contract to rent out the property.

The regulation goes on to state that the certificate must be provided at the earlier of the prospective tenant being provided with written details about the building or the prospective tenant viewing the building. If the prospective tenant consents the certificate can be provided electronically, this presumably includes provision via display on a website. Therefore the key trigger point in most cases will be the provision of written details to the tenant and it is probably worth attaching the EPC to all written details.

EPCs are provided by an approved Domestic Energy Assessor (DEA). DEAs will need to undergo training and assessment by one of a number of government-approved organisations and will then need to pay an annual subscription to maintain their status. Qualified surveyors do not automatically qualify as energy inspectors but they will be able to qualify more easily.

Note that the only requirement for let property is to provide an EPC and that no other part of the HIPS regulations applies to rental property. EPCs remain valid for 10 years or until another certificate is produced for the same property.

Therefore agents and landlords must make sure they always have the most recent certificate on file. EPCs for sales have a shorter lifespan of just 3 years. It is not wholly clear whether these EPCs can be used for let property but there appears to be no reason why a sales EPC cannot be reused for letting purposes thereby giving it a new lease of life!

The upshot is that from October 2008 agents will need to get EPCs for properties that they are marketing to new tenants. As the requirement is on marketing there should be no need to get EPCs for current tenancies or renewals to the same tenants. Equally, properties that have the tenancy agreement signed prior to 1 October, even though the tenancy begins after 1 October should not require an EPC as they will be off the market before the regulations take effect. The EPC will then need to be renewed every ten years. Where properties enter the market prior to 1 October the position is a little less clear.

The government has recently stated that they take the view that properties on the market after 1 October 2008 will definitely be in need of an EPC although they have stated that there will be a degree of latitude in allowing these properties to get a certificate as soon as reasonably possible rather than requiring one immediately on October 1st.

Agent should note however that the requirement to have an EPC before the contract is signed is a strict one however.

There is absolutely no requirement for the EPC to be at a specific level, for the landlord to seek to improve the rating, or for the tenant to be compensated for a poor rating. Landlords who wish to improve their rating should concentrate primarily on boilers and insulation making sure that they have the most efficient condensing combination boiler available and ensuring that all parts of the property are insulated to minimum building regulations standards. The rating system produces a far greater effect for installation of items than it does for their improvement, so installing insulation where there is none will produce a greater effect than adding more.

In terms of the practical position there will be a large number of EPCs required as the regulations come into force and this will then tail off after a few months as many properties coming onto the market will have their own EPCs already from previous sale or rental.

Agents will need to consider the best way to deal with the initial spike and then how they will handle matters long-term. Most agents will be best to contact their HIPs provider (if they have a sales arm) or make an arrangement with an energy inspector in their area. Larger agents, who anticipate a significant volume of work, may be better to consider employing an energy inspector 'in-house' on a short-term contract to cover the initial rush and then contract the work out once this has been dealt with.

Not having a certificate is a criminal offence punishable by a fine. This is enforced by local authority Trading Standards departments. On balance, they are unlikely to take aggressive action on those who mistakenly fall foul of the legislation provided they come into line swiftly once they have been warned.

Agents should put suitable clauses into their Terms of Business and Tenancy Agreements to cover this situation. Suggested samples are available in our Document Vault for Helpline subscribers or to purchase.

Remember that this only applies to residential properties available for letting. The rules for commercial properties and properties for sale are totally different.

©PainSmith Solicitors 2008

*Dr David Smith is a trainee solicitor with PainSmith Solicitors, a niche practice specialising in residential landlord and tenant law.

PainSmith Solicitors Legal Advisors are provided for information only and are not legal advice. If you do have a legal problem, you should talk to a lawyer or adviser before making a decision about what to do.

PainSmith Solicitors Legal Updates are provided for information only and are not legal advice. If you do have a legal problem, you should talk to a lawyer or adviser before making a decision about what to do. You may wish to use the CLS/CDS Directory (www.justask.org.uk/public/en/directory) to locate an adviser. The information provided here is written for people resident in, or affected by, the laws of England and Wales only. You should note that date given in the update and be aware that the information given may become inaccurate due to changes in the law or its implementation.

28 August 2008

by Dr David Smith of Pain Smith Solicitors*

From 1 October 2008 residential let property will require an Energy Performance Certificate(EPC). The provisions are part of The Energy Performance of Buildings (Certificates and Inspections)(England and Wales) Regulations 2007 SI 2007/991.

This can be found in full at http://www.opsi.gov.uk/si/si2007/uksi_20070991_en_1

The requirement is set out in regulation 5 which demands that a prospective tenant be provided with an EPC at the earliest opportunity and certainly prior to entering into any contract to rent out the property. The regulation goes on to state that the certificate must be provided at the earlier of the prospective tenant being provided with written details about the building or the prospective tenant viewing the building. If the prospective tenant consents the certificate can be provided electronically, this presumably includes provision via display on a website. Therefore the key trigger point in most cases will be the provision of written details to the tenant and it is probably worth attaching the EPC to all written details.

EPCs are provided by an approved Domestic Energy Assessor (DEA). DEAs will need to undergo training and assessment by one of a number of government-approved organisations and will then need to pay an annual subscription to maintain their status. Qualified surveyors do not automatically qualify as energy inspectors but they will be able to qualify more easily.

Note that the only requirement for let property is to provide an EPC and that no other part of the HIPS regulations applies to rental property. EPCs remain valid for 10 years or until another certificate is produced for the same property. Therefore agents and landlords must make sure they always have the most recent certificate on file.

The upshot is that from October 2008 agents will need to get EPCs for properties that they are marketing to new tenants. As the requirement is on marketing there should be no need to get EPCs for current tenancies or renewals to the same tenants. The EPC will then need to be renewed every ten years. Where properties enter the market prior to 1 October the position is a little unclear. Experience from the introduction of HIPs suggests that there will be no need to produce EPCs for these properties but the regulations do not say this specifically and so it would be safest to get an EPC for all properties on the market after 1 October.

There is absolutely no requirement for the EPC to be at a specific level, for the landlord to seek to improve the rating, or for the tenant to be compensated for a poor rating. Landlords who wish to improve their rating should concentrate primarily on boilers and insulation making sure that they have the most efficient condensing combination boiler available and ensuring that all parts of the property are insulated to minimum building regulations standards. The rating system produces a far greater effect for installation of items than it does for their improvement, so installing insulation where there is none will produce a greater effect than adding more.

In terms of the practical position there will be a large number of EPCs required as the regulations come into force and this will then tail off after a few months as many properties coming onto the market will have their own EPCs already from previous sale or rental. Agents will need to consider the best way to deal with the initial spike and then how they will handle matters long-term. Most agents will be best to contact their HIPs provider (if they have a sales arm) or make an arrangement with an energy inspector in their area. Larger agents, who anticipate a significant volume of work may be better to consider employing an energy inspector 'in-house' on a short-term contract to cover the initial rush and then contract the work out once this has been dealt with.

Not having a certificate is a criminal offence punishable by a fine. This is enforced by local authority Trading Standards departments. On balance, they are unlikely to take aggressive action on those who mistakenly fall foul of the legislation provided they come into line swiftly once they have been warned.

Agents should put suitable clauses into their Terms of Business and Tenancy Agreements to cover this situation. Suggested samples are available in our Document Vault for Helpline subscribers or to purchase.

©PainSmith Solicitors 2008*

29 January 2008

by Dr David Smith of Pain Smith Solicitors*

Energy Performance Certificates in Let Property Many landlords and agents will be aware that property that is for sale in England & Wales requires an Energy Performance Certificate (EPC) to be supplied to the purchaser as part of the Home Information Pack (HIP). This requirement will be applied to let property during the course of 2008, both residential and commercial

The provisions are part of The Energy Performance of Buildings (Certificates and Inspections)(England and Wales) Regulations 2007 SI 2007/991. This can be found in full at http://www.opsi.gov.uk/si/si2007/uksi_20070991_en_1.

The requirement is set out in regulation 5 which demands that a prospective tenant be provided with an EPC at the earliest opportunity and certainly prior to entering into any contract to rent out the property. The regulation goes on to state that the certificate must be provided at the earlier of the prospective tenant being provided with written details about the building or the prospective tenant viewing the building. If the prospective tenant consents the certificate can be provided electronically.

Commercial properties with a useful floor area of more than 1,000 sq metres which are occupied by public authorities or institutions providing public services are also required to produce a Display Energy Certificate which must be prominently displayed in the premises. This is unlikely to be an issue for readers of this update. EPCs are provided by accredited energy inspectors as they are for HIPs. Note that a domestic energy inspector cannot provide a commercial EPC and vice versa. Energy Inspectors will need to undergo training and assessment by one of a number of government-approved organisations and will then need to pay an annual subscription to maintain their status. Qualified surveyors do not automatically qualify as energy inspectors but they will be able to qualify more easily.

Note that the only requirement for let property is to provide an EPC and that no other part of the HIPS regulations applies to rental property. EPCs remain valid for 10 years or until another certificate is produced for the same property. Therefore agents and landlords must make sure they always have the most recent certificate on file.

The regulations come into force for commercial premises with a useable floor area in excess of 500 sq metres on 6 April 2008 and for all other premises, including residential properties, on 1 October 2008. There have been suggestions that these provisions may be delayed but this will most likely only be done for the April date and there is unlikely to be any delay over introduction of EPCs for residential lets. The upshot is that from October 2008 agents will need to get EPCs for properties that they are marketing to new tenants. There will be no need to get EPCs for current tenancies or renewals to the same tenants. The EPC will then need to be renewed every ten years.

In terms of the practical position there will be a large number of EPCs required as the regulations come into force and this will then tail off after a few months as many properties coming onto the market will have their own EPCs already from previous sale or rental. Agents will need to consider the best way to deal with the initial spike and then how they will handle matters long-term. Most agents will be best to contact their HIPs provider (if they have a sales arm) or make an arrangement with an energy inspector in their area. Larger agents, who anticipate a significant volume of work may be better to consider employing an energy inspector 'in-house' on a short-term contract to cover the initial rush and then contract the work out once this has been dealt with

©PainSmith Solicitors 2008*

*Dr David Smith is a trainee solicitor with PainSmith Solicitors, a niche practice specialising in residential landlord and tenant law.

PainSmith Solicitors Legal Advisors are provided for information only and are not legal advice. If you do have a legal problem, you should talk to a lawyer or adviser before making a decision about what to do.

PainSmith Solicitors Legal Updates are provided for information only and are not legal advice. If you do have a legal problem, you should talk to a lawyer or adviser before making a decision about what to do. You may wish to use the CLS/CDS Directory (www.justask.org.uk/public/en/directory) to locate an adviser. The information provided here is written for people resident in, or affected by, the laws of England and Wales only. You should note that date given in the update and be aware that the information given may become inaccurate due to changes in the law or its implementation.

 

17 March 2008

by Natalie Lewis of Pain Smith Solicitors*

Energy Performance Certificates Update - Commercial Properties

Many agents and landlords will be aware there have been rumours circulating over the past couple of weeks that the requirement for properties to have an Energy Performance Certificate has been delayed.

The requirement for commercial properties to have an Energy Performance Certificate was due to come into force on 6 April 2008, however, this appears to have been delayed.At present it is not clear as to when this will come into force.

The reason for this delay is that there appears to be insufficient numbers of trained energy assessors, particularly at the higher levels dealing with more complex buildings.

In regards to residential properties the requirement for properties to have an Energy Performance Certificate is still due to come into force on 1 October 2008. There does not appear to be any information circulating that this will be delayed.

It is highly unlikely that this date will be pushed back at all, because the Energy Performance Certificates that are required for let property are the same as for properties for sale, which are already required to have a Certificate.

There are significant numbers of Domestic Energy Assessors qualified and more in training so the need is anticipated to be fulfilled easily. Another reason why it is unlikely to be delays in the introduction of residential EPC's is that the process must be in place by January 2009 or England and Wales will be in breach of European Directives, which these measures are intended to bring into force.

As commercial properties are not the main concern of the readers of this update it is unlikely that there will be any effect on when you need to ensure the property has an Energy Protection Certificate. Natalie Lewis is a paralegal with PainSmith Solicitors, a niche practice specialising in residential landlord and tenant law.

©PainSmith Solicitors 2008*

*PainSmith Solicitors Legal Advisors are provided for information only and are not legal advice. If you do have a legal problem, you should talk to a lawyer or adviser before making a decision about what to do.

PainSmith Solicitors Legal Updates are provided for information only and are not legal advice. If you do have a legal problem, you should talk to a lawyer or adviser before making a decision about what to do. You may wish to use the CLS/CDS Directory (www.justask.org.uk/public/en/directory) to locate an adviser. The information provided here is written for people resident in, or affected by, the laws of England and Wales only. You should note that date given in the update and be a

 

See also:

________________________________

*See also Section 13 Notices and Is the deal closed? The use of the 'Subject to Contract' formula- For full article Click Here

________________________________

*See also Safety Glass and Defective Premises Act - The Information on a Court of Appeal decision (7th February 2007) regarding the Defective Premises Act 1972 For full article Click Here

________________________________

*See also Implementation of the Regulatory Reform (Fire Safety) England & wales) Order 2005 Click Here

________________________________

*See also Understanding Business Tenancies June 2007 Click Here

________________________________

*See also Duty of Landlords To Mitigate Loss Click Here

__________________________

See also Arbitration - April 2008 - by David Smith - Pain Smith Legal update Click here

* Articles courtesy of PainSmith Solicitors are a niche practice specialising in Landlord and Tenant Law. Based in Medstead in Hampshire, they are ideally situated to provide an efficient service to clients nationwide as well as those based in Central London and the Home Counties.

See also:

Changes for BER - EPC certificates from 9th January 2013

Statutory code of Practise on racial equality in housing

ARLA’s Response to the Law Commission Report - August 2008 and The Law CommissionHousing: Encouraging Responsible Letting

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