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Don't be fooled - new MEES regulations come into force 1st April

28th March 2018

Don't be fooled - new MEES regulations come into force 1st April

On 1 April 2018 the Minimum Energy Efficiency Standards (MEES) being brought in as part of the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 will come into force.

The new regulations affect both residential and commercial landlords and are aimed at ensuring properties reach certain standards in energy efficiency.

MEES and residential landlords

All privately rented properties in England and Wales will be affected - other than the following exemptions:

  • properties that are to be used for less than four months of each year
  • certain temporary buildings
  • listed and/or other buildings with protected status (where making changes to ensure compliance would alter the property’s character or appearance).

Compliance

All rental properties must have an EPC rating of E or higher. Landlords will not be allowed to let properties with an F or G rating.

Landlords will be required to carry out improvements sufficient to bring the property up to (at least) an E rating.

Landlords are required to make ‘appropriate, permissible and cost-effective improvements’.

Landlords may be eligible for an exemption if they can provide evidence to the following:

  • they have carried out cost-effective improvements, but the rating remains F or G
  • the occupying tenant or freeholder withholds consent where it is required to carry out works to a property
  • making the improvements would cause the value of the property to decrease by over 5% (as evidenced by a surveyor)

Timescales for compliance

1st April 2018:

properties where; new tenants are being granted new tenancies; and

new tenancies are being granted to existing tenants (including extensions or renewals)  

1st April 2020

All privately rented property must be compliant. For example:

a rental property has an F rating. There is a tenant in place, and the tenancy is due to expire in January 2021. While you do not need to be concerned about making the improvements just yet, but will need to make sure you bring the property up to an E by 1 April 2020.

Non-compliance

Where a local authority believes a landlord has not been compliant with the new regulations, a compliance notice will be served to request further information. Where this is not provided, fines of up to £4,000 can be issued depending on the offence.

Next steps

Review all properties that you own. Consider the following:

  • what is EPC rating for each property
  • do any of them require works to be carried out?
  • do any exemptions apply?
  • when are your properties due for renewal?

 

MEES and commercial landlords

The majority of commercial properties in England and Wales will be affected other than the following exemptions:

  • buildings that are not required to have an EPC
  • tenancies of less than six months (with no right to renew) or over 99 years.

Compliance

All rental properties must have an EPC rating of E or higher.

Landlords will be required to carry out improvements sufficient to bring the property up to (at least) an E rating.

Landlords are required to make ‘appropriate, permissible and cost-effective improvements’ to bring the property up to standard

Landlords may be eligible for an exemption if they can provide evidence to the following:

  • they have carried out cost-effective improvements, but the rating remains F or G
  • the occupying tenant or freeholder withholds consent where it is required to carry out works to a property
  • making the improvements would cause the value of the property to decrease by over 5% (as evidenced by a surveyor)

Landlords must register all exemptions in a national register. If they fail to register the exemption, it will be ineffective. This amounts to non-compliance with the regulations.

Exemptions last for five years and are not transferable to a new landlord.

Timescales for compliance

1st April 2018 

properties where landlords are looking to grant a new tenancy to a new tenant

properties where new tenancies are being granted to existing tenants (including extensions or renewals)

 1st April 2023 

all commercial lettings must be compliant

Non compliance

Penalties for non-compliance vary depending on how long the property has been in breach of MEES Regulations as follows:   - Failure of up to three months: 10% of the property’s rateable value. (Minimum £5,000 to a maximum of £20,000). - Failure of three months or over: 20% of the property’s rateable value. (Minimum £10,000 to a maximum of £150,000).

Next steps

Review all properties that you own. Consider the following:

  • what is EPC rating for each property
  • do any of them require works to be carried out?
  • do any exemptions apply?
  • when are your properties due for renewal?

If you would like further information on the MEES Regulations or advice on how to comply, contact Nyree Applegarth or a member of Higgs & Sons’ Property Litigation team on 0345 111 5050.

 

 

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Brierley Hill
West Midlands, DY5 1LX

Email: law@higgsandsons.co.uk
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