Commercial Landlords whose properties do not have the right energy performance certificate won't be allowed to rent their properties

Thousands of landlords throughout the UK are unaware of new Government rules about Energy performance which may make it illegal to let their properties, our survey has found.

From April 2023 Commercial Landlords whose properties do not have an energy performance certificate (EPC) of E or above will not be allowed to rent their properties – killing the value of their investment property and causing chaos for their tenants.

Residential landlords have a little more time to prepare – their rules are scheduled to change in April 2025, but the proposed change is more onerous as lettings will be illegal if a property does not have an EPC rating of C or above from that date.

Head of Property & Construction Heather Powell, who commissioned the survey which polled over 100 major landlords, said: “The results are concerning, both for Landlords, their funders, their tenants, and for the Government’s target re zero carbon emissions in 2050.

“UK Landlords have a crucial role to play in reducing carbon emissions in the UK, but the Government has not communicated this, despite introducing legislation which will make landlords improve the energy performance of their properties. Commercial landlords have now only got four months to complete any works required to comply with the rules being introduced from April 2023.

“Residential landlords have more time, but the combination of increased interest rates, and the change in the personal tax regime which has substantially increased the tax payable by buy-to-let landlords has, for many, meant that they do not have the funds required to complete the necessary works. The solution for many in this position will be to sell their properties, to occupiers.

“As homeowners are not required to complete the works, the opportunity to improve the energy performance of UK homes will have been missed – and carbon emissions will not be reduced.

“The solutions? Jeremy Hunt has indicated that support for businesses from April 2023 with energy bills will be tied to energy improvements. If he can introduce a coherent tax and grant policy in April 2023, which landlords understand and can access, he will assist the country significantly in achieving the zero-carbon target by 2050.

“Measures should include a review of capital allowances, and expansion of this tax relief to ensure an immediate deduction is given against tax liabilities for all the works undertaken to improve the energy efficiency of residential and commercial properties.

“Our Prime Minister has stated that it is essential for all nations to stick to commitments made at COP26. UK landlords have a vital contribution to make if the UK is going to deliver on our commitments, but they need funding from the Government via tax relief to deliver.”

Would you like to know more?

If you would like to discuss how the EPC rating changes affect you, please get in touch with your usual Blick Rothenberg contact or Heather Powell using the details on this page or the form below.

And if you’d like to read our latest insights and guidance for the Property & Construction sector, please visit our Property Hub.