Landlord Advice from Central Housing Group

Landlord Advice Teamfocus – Energy Efficiency Standards

As April 1st 2018 approaches more and more calls to the Landlord Advice Teamfocus on the new requirements around energy efficiency.

For most callers this is a relatively simple case of explaining that, from that date, it will be unlawful to grant a new tenancy (including renewals) to someone for a property with an EPC rating of F or G.

Similarly from April 1st 2020 it will be unlawful to have existing tenancies with an EPC rating of F or G.

There are a number of quirks and exceptions to this upcoming legislation however, and this week’s call highlights just one of the issues landlords may face in this situation.

Our landlord called in with a very interesting question regarding succession.

He had bought the property at auction back in 1998, only to discover he had a regulated tenancy.

Regulated tenancies can transfer upon the death of one tenant to another.  This is called succession, but it only happens in certain limited circumstances.

For example, if a regulated tenant dies, and their partner lives with them immediately prior to their death, then they succeed to the property.

It will continue as a regulated tenancy on the same terms with a new tenant.  This can only occur once but an assured tenancy can be created for a third family member afterwards in certain limited circumstances.

If it passes on to a different member of the family such as a son or daughter, then it will become an assured tenancy instead.  They must have lived with the previous tenant for the previous two years before their death, and be related to all the previous regulated tenants on the tenancy.

Our landlord called in with a very interesting question regarding succession.

He had bought the property at auction back in 1998, only to discover he had a regulated tenancy.

This tenancy had already passed from the original tenant to her husband, but the remaining tenant lived with their son.

This situation continued until the present day where the landlord discovered the current tenant was in ill health.

The landlord was well aware of the rules of succession in these cases, so he understood that when the tenant died, the tenancy would become an assured tenancy.

He was concerned as to whether or not this would count as a new tenancy, triggering the need for an EPC.

As a long term regulated tenancy, the landlord was absolutely certain this property would not meet an E rating so he was understandably worried.

Under the new minimum energy efficiency standards, it is important to understand that you only need to provide an EPC, if your property requires one in the first place.

This is only triggered where the property was sold or let after the introduction of the EPC legislation.

In practice this means you don’t need an EPC if you have let to the same tenants since October 2008 on the same tenancy agreement.

This distinction is important because new regulated tenancies cannot be created after 1989 so will not need EPCs in any normal circumstances.

The only time a regulated tenancy would require one is if the property had been sold since the EPC legislation came in.  The landlord was safe on this as he had bought back in 1998, well before the EPC legislation came in.

The landlord was also safe under the rules of succession for assured tenants too.

Recent updates to the guidance on the minimum energy efficiency standards also made clear that assured tenancies that were created by succession did not require an EPC unless a property had been sold.

As such the landlord was safe here and in the future from the EPC regulations provided he did not give any new tenancy after this date.

Landlord Advice Teamfocus Manager Rupinder Aujla said “We are always happy to help our members navigate complicated legislation, and this is certainly a complicated issue.

“While this particular situation worked out well for the landlord, we would advise all members to make sure they are planning now for April 1st 2018.”

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