Concerning new data released by Quick Move Now has revealed that one in ten properties could become unrentable by the year 2018, should Government legislation go ahead.
From the 1st April 2018, new legislation is to make it unlawful to rent a property with a poor efficiency rating. At present, properties are graded from A to G, depending on their energy efficiency. Under the proposals, any rented property in the private rental sector would require a minimum energy performance rating of at least an E.
Poor energy performance
Data from Quick Move Now shows that over 8% of homes currently available to rent fall below the minimum energy efficiency requirements proposed.
Investors taking out landlord insurance on a property must be sure to consider their energy efficiency regulations before choosing to invest.
Danny Luke, managing director of Quick Move Now, noted: ‘According to the Royal Institution of Chartered Surveyors (RICS), the number of UK households renting property rose from 2.3 million in 2001 to 5.4 million in 2014. RICS predicts that this figure will rises again by a further 1.8 million before 2025 and suggest that the UK is facing a critical shortage of rental properties.’
‘It is, of course, imperative that properties available in the private rental sector are of a high standard and energy efficient, however losing around eight percent of rental properties would cripple the rental market. It is commendable that the government is keen to improve the quality of rental property, but for the proposed new legislation to be workable, a great deal of thought will need to go into how landlords can be supported to make the necessary changes. This is especially true in light of the government’s decision to stop funding Green Deal improvements,’ he continued.
Concluding, Mr Luke said: ‘Recent changes to tax relief, stamp duty and lettings fees guidelines mean many landlords are already concerned about the viability of their businesses and there have been reports of as many as one in four considering selling their rental properties*. If significant energy efficiency improvement work is likely to be required, landlords will need support if we want to ensure a vibrant and efficient private rental market in the coming years.’