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Minimum EPC for Rental Property

There has been a large amount of press recently about minimum EPC (Energy Performance Certificate) ratings for rented property. At the moment this legislation does not apply to Scotland, only to England and Wales. The Scottish Government consulted on plans to introduce similar requirement in 2017 and have published an analysis of the responses here

https://www.gov.scot/Publications/2017/11/6863

The Scottish Executive have designated energy efficiency as a National Infrastructure Priority with Scotland’s Energy Efficiency Programme (SEEP) being a significant part of this. There will be changes made to the repairing standard with the aim to ensure homes in the PRS meet minimum efficiency standards to bring it closer to those required in social rented housing in summary these are expected to be:

  • The standard will be based on the energy rating on the EPC. The standard will be an EPC band E initially and will be raised to a band D overtime with a potential to raise it further.
  • The initially standard will apply to properties where there is a change in tenancy after 1st April 2019. Where and EPC shows a bad F or lower the owner will need to have a minimum standards assessment carried out and lodged on the EPC register before renting out the property and an owner will have six months from the date of the assessment in which to carry out the works.
  • All properties covered by the repairing standard would need to meet the minimum standard by 31st March 2022
  • All properties covered by the repairing standard would meet the higher threshold at a change in tenancy after 1st April 2022
  • The owner of the property will be responsible for getting the improvements required by the minimum assessment carried out.
  • Local authorities have the power to issue civil fines of up to £1500 against any owner who does not comply.
  • There will be some situations where an owner is not required to do all the improvements identified in the assessment or will have a longer time to do so. There will be a cost cap of £5000.

Ministers will develop draft regulations for further consultation and changes will be brought in through secondary legislation through the Scottish Parliament. The latest update is draft legislation will be put in front of Parliament early in the new year and the expectation is the new regulations will come into force as detailed in the consultation ie 1st April 2019. But until we have seen the actual detail it is difficult for us to comment fully.

It should also be noted that properties would only need to be brought up to the minimum standard where it is technically feasible and cost effective. As mentioned above the current proposed spending cap is £5000 but there is lobbying to reduce this similar to the cap in England and Wales which is £2500.

Any landlords with and EPC rating of F or below will need to prepare to have an assessment carried out and will where feasible will need to have work done to improve the rating of their property to bring it up to the required standard.

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