If you are a landlord and need to know how to improve an EPC rating, then we will explain more in this article.
It’s important to appreciate that in the UK when a property is built, rented or sold it needs to have an energy performance certificate, also known as an EPC, by law.
It’s this certificate that shows how much the property will cost to heat and light, and what the carbon dioxide emissions will be.
The certificate is also a pointer as to what improvements can be made to improve its energy efficiency.
The EPC ratings are in bands that go from A, which stands for the most efficient, and go down to G, which is for those homes that are the least energy efficient.
EPC certificate is valid for 10 years
The EPC certificate is valid for 10 years from when it is issued and it will have advice about how the building’s energy efficiency can be improved.
This element could prove fruitful when it comes to improving your rental property’s energy efficiency.
The rating bands for an EPC have a numerical score – the scale is from 1 to 100 – and any improvements you make will boost the score and its overall EPC rating.
However, it’s important to know what the minimum EPC rating is for a rental property because the rules have changed.
Since April 2018, a new law was introduced to boost the energy efficiency of rental homes so they now need to have an EPC rating of at least E.
New EPC law covered new tenancies
The new EPC law covered new tenancies, but from April 2020 the legislation was extended to all existing tenancies, regardless of when they began.
As a landlord, you need to appreciate that it’s now unlawful to rent out a rental home that falls below an EPC rating of E.
So, to avoid falling foul of the penalties, you may need some tips on how to improve your rental property’s Energy Performance Certificate rating – not doing so could see you receiving a penalty of up to £5,000 for non-compliance. This fine will vary depending on how long the breach has been going on for.
You also need to appreciate that your tenants can raise the lack of an improvement to their energy rating with the courts – so you will be compelled to carry out the improvements work AND face a fine for non-compliance. This will happen if you tell the court that you cannot afford to carry out the work.
So, if you rent out property after 1 April 2020 that has an EPC rating of F or G, you will be breaking the law.
How many rental homes will be affected?
The UK’s private rental sector has more energy inefficient homes than the social sector with around 6.3% of rental properties being rated as F or G. In social housing, just 0.7% properties are rated like this.
The Residential Landlords’ Association calculated in 2019 that it would cost an average of £1,200 for a landlord to upgrade their property before it could be put on the market for a new tenancy.
However, the private rental sector has been improving its stock, and in 1996 nearly 40% of rental properties had energy efficiency ratings of F or G. In 2016, this had fallen to 7%.
The government had calculated that around 285,000 rental homes would need urgent work carrying out by their landlords when they introduced their legislation.
Tips to improve a rental home’s energy EPC
If you are currently a landlord, or are thinking of buying a property as an investment, then you will need to bring that property up to the required legal standard before tenants move in.
All landlords need to appreciate that by 2022 the minimum requirement for tenancies will be an EPC rating of C or D.
While you will need to spend money on a property, it’s going to be more cost-effective to carry out the retrofit work in one go, rather than carrying out lots of small upgrades.
This means you’ll need to improve the heating system, potentially replace the windows, improve insulation and other improvements. Here’s our quick checklist of other ideas:
- Upgrade to LED lightbulbs
Switching to LED lightbulbs could make a big difference to your property’s EPC rating. They are not only eco-friendly, they are also more energy efficient than traditional lightbulbs. They are also a fairly inexpensive and quick way to boost an EPC rating.
- Insulate the roof and walls
If your property has poor levels of insulation, then you really should be considering insulating the walls and roof. This could be a very efficient way of boosting your EPC rating. The loft insulation will need to be at least 270 mm thick and this will have a big impact on the energy that escapes through the roof. Consider that a home without an insulated roof will see 25% of its heat going through the roof means the cost will be a sound investment.
You should also consider wall insulation – whether you have a solid wall or a cavity wall. Solid walls are generally found in older properties, usually built before 1920, while cavity walls tend to be for modern properties and have a gap between the brickwork.
Costs for wall insulation will vary, but for a semi-detached property it will cost between £350 and £500 to have the insulation installed – a material is piped into the cavity to fill the gap. This is a fairly cheap exercise to carry out and it could have a huge impact on the EPC rating.
For those with solid walls, then you’re looking at a hefty bill with estimates ranging from £5,000-£20,000, so this is a very expensive option but necessary if you want to rent your property to tenants.
- Invest in triple double glazed windows
As part of our list of improvements, you could invest in triple- or double-glazed windows if the property does not have them already. This will reduce the amount of heat being lost from the property.
Most modern homes will already have double glazing and for those rental homes without it, then they may struggle to reach the minimum EPC rating.
A terraced home, for example, could cost between £2,000 and £5,000 to have double glazing windows installed. However, triple glazing is growing in popularity and are more efficient than double glazed windows, but they cost more to install.
- Invest in a new efficient boiler
There’s no doubt that a property’s heating system is a vital part of the home’s EPC rating. If you have an old boiler, it may be worth switching to a condensing version to boost your rating.
Inefficient boilers do detract on the home’s energy efficiency and an efficient boiler could boost your EPC score. The costs for a new boiler range from £1,000 to £3,000 but this could be a sound investment because it will make your rental property much more energy efficient.
It may also be worth considering intelligent thermostats as well as connected radiator controls as part of investing in ‘smart heating technology’ so your tenants can easily save money on heating bills.
- Installing a smart meter
Having mentioned smart technology, the UK government wants to see smart meters installed in every home, but there are issues with them.
These meters are an efficient way of telling tenants how much energy they are using and how much it’s costing so they are a way of helping to modify behaviours, so energy bills are reduced.
Improving a rental property’s energy efficiencies
For those landlords who are looking for a long term solution for improving a rental property’s energy efficiencies and which will give a massive boost to the property’s EPC rating, then it may be worth considering an investment in renewable energy.
For example, this may include ground source heat pumps as well as solar panels.
There may be funding available for installation of these, though the installation can be an expensive process and there are ongoing maintenance costs involved.
You could even consider installing a wood burning stove, rather than having an open fireplace. This will give greater fuel efficiency and reduce energy costs.
For a rental property, you’ll also need a carbon monoxide detector fitted in any room with a solid fuel burning appliance.
The also some cheaper solutions for those wanting to boost their EPC rating, including:
- Buying a hot water cylinder jacket: These cylinder jackets were popular in day’s gone by and the £20 cost will lead to one of the best investments for saving energy.
- Keep your paperwork: If you’ve had energy improvement work carried out, then you’ll need to keep your paperwork to hand. That’s because EPC assessors will assume that work has not been carried out, unless you prove otherwise.
- Biomass boilers: It’s possible to switch to a biomass boiler that uses renewable wood pellets as a fuel as they are as efficient as gas fuelled boilers and cheaper to run.
- Tell your tenants: One of the bigger incentives for having an energy efficient home is that it becomes more attractive to tenants. They will appreciate that living in your property will cost less to keep warm than in other poorly-insulated homes. This is a positive step and should be promoted when looking for new tenants.
Improvement to a rental home’s EPC rating
The bottom line when looking for an improvement to a rental home’s EPC rating is that the process only looks at the permanent improvements that are made to the building’s fabric. This means thinking about the long-term upgrades that are necessary for reducing energy and heat use.
It may be that simple touches such as having a sausage dog draft excluder behind doors to keep the heat in will help keep bills low but they will not boost the property’s EPC ratings. If you have an older property, then it may be a good idea to put sealant between the floorboards to boost efficiencies and this can be a cheap solution. There are professionals available to carry out this work and they could also fit draught excluders around the property’s windows.
That’s because you’ll need to find a permanent way to fill any gaps that have heat escaping from them such as the letterbox, doors and windows and even your property’s keyholes.
Essentially, all landlords need to be aware of energy performance certificate ratings, particularly since the rules will be tightened from 2022 and since the government has made this an issue, the private rental sector in the UK should consider that the ratings may become even tighter in future years, so investing now will be money well spent.