EPCs and HIPs
Great news for landlords. HIPs are dead!
Home Information Packs were bought in by the Labour government in August 2007 in a bungled attempt to speed up the process of selling a property.
They failed and were yet another piece of largely useless paper that a landlord was forced to have if they were looking at marketing their property for sale.
Unfortunately, EPCs or Energy Performance Certificates which were an element of the HIP are still here & probably here to stay. This is because unlike HIPs; EPCs are a European creation. Penned by those Eurocrats in Brussels; the legislation required to get rid of them cannot be bought about by simply tweaking the law in Parliament.
What do they do?
The EPC or Energy Performance Certificate was bought in to provide potential buyers or tenants information about the relative energy efficiency of properties. They do this by giving properties an energy efficiency rating from A to G in much the same way fridges are rated. A being the most energy efficient and G being the least.
Chris Grant of EPC specialist EPC Choice highlights the fact that:
“It has been estimated that almost half of the UK’s carbon emissions are the result of our buildings. That’s almost double the amount produced by cars and planes.”
Carbon emissions are dramatically impacted by factors such as insulation, the kind of heating systems in place and awareness of energy saving steps. It was hoped by policy makers that the production of an EPC would be the first step in encouraging property owners to deal with environmentally inefficient buildings by taking steps to improve them.
Anecdotal evidence from landlords would suggest that most landlords pay little or no attention to the EPC once obtained. They are filed away only to be forgotten about until the next time a landlord has to market their buy-to-let property. Once purchased an EPC last for 10 years unlike a Gas Safety Certificate which is require annually.
Get an EPC from EPC Choice here
EPCs as a marketing tool
Policy makers have tried to promote the maligned EPCs by suggesting that it can be a helpful tool for landlords marketing their buy-to-let property. The idea being that landlords with more energy efficient properties will be able to market them to tenants as costing less to run, allowing landlords to charge more rent or be able to let their property more easily.
If this is so then the tenants I’ve come across are largely ignorant of the fact or genuinely not bothered. I’ve never been asked by a tenant to see the EPC on any pf my rental properties.
In this respect, the EPC must be viewed as having failed
Do I really need one?
The sad facts are that unlike much of the tenancy legislation intended to regulate landlords and the private rental sector which has bitten the dust recently. The EPC is here to stay. This is because it; just like 80% of UK laws has not been created by Parliament but has come straight off the policy making machine that is Brussels. As an EU Directive there is little or no opportunity to scrap this legislation.
The EPC unfortunately appears here to stay.
Chris Grant of EPC Choice warns landlords that:
“The penalties for non compliance are likely to remain the same as for landlords who do not comply, with an initial £200 fine which can be reoccurring until such time as the EPC is produced.”
The good news for landlords is that with the demise of the HIP, many HIP assessors have been forced into providing EPCs. The result is that prices for EPCs have been falling.
However, many of the companies advertising low prices are failed HIP providers masquerading as professional energy assessor firms. Others may be newly qualified assessors desperate to recover the £4000 average cost needed to train as an EPC producer.
Our advice to landlords is that EPCs are rubbish! However a landlord still needs one if they are going to market their buy-to-let property for rent.
Life’s sometimes like that.
EPC Questions & Answers