Landlords - are you aware of MEES?
Mon 23 Apr 2018
Over the last few years, the Government have been busy introducing new legislation to the private rented sector. The start of 2018 has been no different. Several consultations have been launched, one on energy efficiency, and there are new Minimum Energy Efficiency Standards (MEES) with which to comply. The 1 April 2018 has arrived, and MEES is now in force. All landlords of privately rented property in England or Wales must ensure that their properties reach at least an Energy Performance Certificate (EPC) rating of an E before granting a new tenancy to new or existing tenants.
The simplest way in which to understand MEES and when it will affect you is to understand the trigger points. The trigger points for MEES will be granting a new tenancy to a new or existing tenant. At this point, if an EPC is legally required for the property, then the rules contained in MEES will apply for that renewal. The trigger dates set out in the regulation are:
1st April 2018 - It will be unlawful to grant a new agreement with an EPC rating below an 'E'. From this date, an energy rating below ‘E’ will be a ‘substandard property’ (though plans exist to increase this to D and then C in the long term). It is the substandard properties that will be restricted.
From the 1st April 2020 - Landlords must not continue to let a substandard property, even to an existing tenant on an assured shorthold tenancy. The regulations will only apply to residential privately rented property which are required to have an EPC.
If you own a property banded F or G, do not panic! Works to improve the banding to an 'E' can in some cases be simple and inexpensive. There are also some circumstances where you will be able to apply for exemption from complying with MEES if you demonstrate one of the following:
- All improvements have been made to the property that can be made, but it remains a band F or G
- Funding is not available for the improvements needed. This is due to the basic rule that improvements needed should not have to be funded by the landlord
- Consent to undertake works is refused by a third party, such as a local authority or the tenant
- A suitably qualified expert provides written advice that the improvements would result in devaluation of the property by 5% or more, or that the works would cause damage to the property
- Exemption of six months for a new landlord taking ownership of a property. Evidence will be required of the purchase or inheritance.
Normally exemptions last for five years and will need to be lodged on the PRS exemptions register. If the exemption is based on the tenant refusing consent, the five year exemption will lapse when the tenant leaves and the work will have to be done.
On 28 December 2017, the Government launched another consultation regarding MEES. The discussion is around whether landlords should be required to fund some improvements and if so, how much should they fund. The current proposal is for landlords to fund improvements to the ‘total value’ of £2,500 per property. ‘Total value’ means that this would be £2,500 including any Green Deal or ECO funding. This proposal is designed to ‘future-proof’ the regulations and make them as effective as possible while protecting landlords against excessive cost burdens.
It is currently estimated that by 2021, a quarter of households in the UK will rent privately. The introduction of MEES will help to ensure lower energy bills, aiding many of these households within the private rented sector out of fuel poverty. Landlords with F and G banded properties under management with The Accommodation Bureau are currently being contacted to discuss their options regarding MEES and are being put in touch with our trusted Energy Assessors who can provide expert advice. We are taking a proactive approach with the legislation and informing landlords now rather than waiting until the tenants vacate so void periods are minimised. If you are a landlord and are confused or worried about MEES, then do not hesitate to contact us and we can point you in the right direction for further help or advice.
Legal disclaimer: This article is produced on a limited basis. Whilst the information researched and provided is believed to be correct, neither the author nor anyone involved in the production of it, accepts responsibility for its accuracy.