What’s on the horizon for residential landlords?

The government has confirmed that landlords in England will need to ensure any let residential property has a minimum Energy Performance Certificate (EPC) rating of C by 2030.

This is a reversal of the Conservative government’s announcement in September 2023 which scrapped plans to increase the minimum EPC from an E to C between 2025 and 2028.

The Department for Energy Security and Net Zero is yet to issue any more details regarding what exemptions will be available.

However, it is anticipated the government will continue to provide funding through its Boiler Upgrade and Great British Insulation Scheme which may help some landlords.

Renters’ Rights Bill

At the same time, the government is pushing forward with a Renters’ Rights Bill to replace the Renters’ Reform Bill, which had been progressing through Parliament.

The Renters’ Rights Bill is similar to the previous Bill in that it aims to ban no-fault evictions (Section 21 notices) and increase tenants’ rights and protections.

Tenants will be able to challenge unreasonable rent increases, have the right to request a pet and it will also be illegal to discriminate against potential tenants who have children or receive benefits.

The aim is to create a better balance for tenants and landlords between flexibility and security. It is hoped that removing Section 21 rights, while at the same time introducing expanded grounds for possession, removes the threat of arbitrary evictions, but will still allow the property to be reclaimed by the landlord if necessary.

Property standards will also need to be improved with the introduction of Decent Homes Standard (DHS). This will create a minimum standard before a property can be let.

Awaabs Law, which provides clear legal expectations on how agents and landlords must respond to any hazards reported during a tenancy, will also be extended to cover the private-rented sector.

You can read a more detailed breakdown of the Renters’ Rights Bill on our main Strutt & Parker website.

Guidance for adapting historic buildings

Historic England has produced an advice note which may be useful for owners and occupiers of historic buildings seeking to make changes to improve energy efficiency.

The document, Adapting Historic Buildings for Energy and Carbon Efficiency, has been drafted to support more consistent decision-making by local planning authorities when it receives applications to install measures such as heat pumps, solar panels and insulation.

It outlines Historic England’s position on a range of common interventions to mitigate climate change and sets out what it considers likely to be, and not to be, acceptable in most instances.

The guidance is not an exhaustive list of interventions and property owners will still need to gain the necessary consents before starting work.

However, it does provide owners with greater clarity around what some of the considerations should be when trying to carry out these sorts of works.

Most significantly, it also offers local planning authorities a clear steer that Historic England believes it is possible to improve the energy efficiency of all buildings to some extent without unacceptably harming their significance. This may help to remove some of the barriers which owners of listed buildings have traditionally faced.

Clean heating push on way in Scotland

Improving the energy efficiency of residential property remains a hot topic in Scotland, but exactly what is expected of landlords is yet to be confirmed.

The Scottish Government had previously proposed introducing a minimum EPC rating of a C in the private rented sector by 2025, but it never legislated to bring this in.

Instead, in late 2023, it issued a consultation seeking views on the introduction of a new Heat in Buildings Standard. This focuses on moving towards ‘clean’ heating systems and proposes new measures for energy efficiency, rather than being tied to an EPC rating.

The document proposes that, by the end of 2028, private landlords should meet a new minimum energy efficiency standard based on the installation of a prescribed list of measures.

Owner occupiers will also need to meet the same minimum standards before the end of 2033. The consultation also proposes to prohibit the use of ‘polluting heating systems’, such as gas, oil and LPG boilers, as the primary source of heat after 2045.

In addition, by some future date which has yet to be determined, it suggests anyone buying a property will need to comply with the ban on polluting heating systems – possibly within two to five years of their property purchase. The Scottish Government is still considering responses to the consultation, but in early September 2024 signalled it is pushing forward with these plans by including the Heat in Buildings Bill in its 2024/25 legislative programme.

It has proposed that works already undertaken by property owners to improve EPC ratings should be considered in the new standard.

But until things are more certain, our advice is that each property needs to be considered on an individual basis depending on whether the property is vacant, the tenure, construction type and any loans or grants that may be available.