The Residential Landlords Association (RLA) is calling for all private rented homes to be made as energy efficient as possible.
Since April this year, it has become illegal to grant a new lease (even to existing tenants) on a domestic or commercial property with an Energy Performance Certificate (EPC) rating below E. As of April 2020, this will apply to all tenancies.
The Government recently began a consultation, seeking evidence on how EPCs are currently performing, with the aim of gaining feedback and suggestions of what improvements could be made. The Call for Evidence: Energy Performance Certificates for Buildings has been published by the Department for Business, Energy and Industrial Strategy.
The Government is also considering raising the legal rating to a C by 2030, and the RLA is calling on policy makers to be more ambitious for the private rental sector. In its forthcoming submission to the Treasury ahead of the Budget, the RLA will make clear its suggestions on how the Government can achieve this.
It wants all work carried out by landlords that is recommended on an EPC to be considered as a tax-deductible repair. The aim is to encourage a culture of continuous improvements to properties, rather than simply meeting the set targets and failing to push for further progression.
RLA’s research body PEARL has released data from new research, revealing that 37% of landlords with properties rated F and G cannot afford to bring their property up to the minimum E rating. On average, these landlords reported that it would cost them almost £5,800 to improve their properties to meet this required standard.
Past research from RLA PEARL has found that 61% of landlords reported that tax relief for energy efficiency property changes and repairs would encourage them to make such improvements.
With the Landlord Energy Savings Allowance having been withdrawn, due to a lack of take up, the RLA feels that the provision of targeted tax relief for energy improvements could be more of an enticing option, especially with the minimum targets that need to be met.
In 2006, just over 25% of private rented homes had an EPC rating of F or G. However, by 2016 this was reduced to under 7%.
The Committee on Climate Change’s (CCC) annual report has found that the UK is currently on track to miss its legally binding future carbon budgets, due to a lack of progress in cutting emissions from buildings.
David Smith, RLA Policy Director, has commented: “Whilst progress has been made, we need to be more ambitious for the country’s stock of private rented homes.
“Energy efficient homes are good for tenants and good for landlords. That is why we need to use taxation far better than we do at present to encourage a continuous culture of energy improvements.
“Using recommendations on Energy Performance Certificates in this way is a clear and easy way of achieving this and we call on the Chancellor to adopt the policy in his Budget.”