EPC costs will force rural landlords to offload 50,000 properties, warns trade organisation
Energy efficiency changes could result in landlords selling off more than 50,000 rural rented homes, sparking rent increases and a worsening housing crisis.
The Country Land and Business Association (CLA) warns that many properties will never be able to reach the higher minimum standards proposed by government, which is likely to result in landlords selling up.
The government plans to raise the minimum energy efficiency rating from Band E to Band C for new tenancies from 2025 and for all existing tenancies from 2028, but the organisation says 12.4% of rented rural homes don’t even meet Band E, meaning that losing these from the sector would result in 51,653 fewer properties.
Meanwhile, it believes the assessment methodology continually undervalues the energy efficiency of older, off-gas grid homes.
An increase in the ‘landlords’ cap’ has also been proposed – the maximum amount of money a landlord must invest to improve a property’s energy efficient rating – from £3,500 to £10,000.
But the costs of converting properties could be prohibitive for rural landlords, says the CLA.
Even if landlords were able to find £10,000 to improve the energy efficiency rating, rent would have to increase by 6% annually for the next 15 years to recoup their investment.
The CLA adds that rural landlords are already finding it hard to access the Green Homes Grant due to a lack of rural TrustMark installers and urban accredited firms unwilling to travel to remote areas.
President Mark Bridgeman (pictured) says many members have invested significant sums on renewable options already.
“The unique challenges that affect rural properties in decarbonising seem to have been forgotten about in the new policy proposals,” he says.
“If the government are serious about decarbonising rural properties, they need to support and invest in the sector.”
The government has just finished a consultation on its EPC upgrade proposals.
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BREAKING: Government gives students £50m to survive Covid, tells landlords to offer rent reductions
The government has revealed a further £50 million to help students who are struggling financially during the Covid pandemic, in addition to £20 million announced in December.
This extra funding will flow through universities and will include funds to help students pay their private accommodation rent and Covid-related costs including accessing teaching online.
This announcement follows the decision by many universities and accommodation providers to offer rent rebates for students who need stay away from their term-time address.
The Universities Minister Michelle Donelan (pictured, above) is also encouraging private landlords to join them and offer students partial refunds.
“This additional support will provide real, tangible help for those students struggling financially as a result of the pandemic,” she says.
“We will continue to prioritise a full return to education as soon possible, in line with public health advice.”
The government is also asking all providers of student accommodation including universities to ensure their rental policies have students’ best interests at heart and are communicated clearly.
Ben Beadle, Chief Executive of the NRLA, (pictured) says: “Whilst we welcome the news of further financial support, it begs the question why student renters are being treated differently to all others.
“Given students are continuing to receive maintenance loans alongside this new funding, Ministers need to explain why the same support is not being provided to other renters struggling as a result of the pandemic.
The NRLA’s figures suggest that seven per cent of private renters have built arrears due to coronavirus, while the government has admitted that private renters have been hardest hit by the pandemic.
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MPs call for landlords to be released from nightmare of cladding scandal
An Opposition Day Debate in parliament organised by Labour has highlighted the financial disaster facing many landlords who own properties within properties with dangerous cladding or suspected compliance problems.
The debate, which called on the government to take greater action to solve the ongoing crisis for a range of leaseholders in thousands of buildings across the UK following the Grenfell Tower disaster, was won by Labour by a margin of 263 votes after Conservative party whips instructed all its MPs to abstain from the vote, which is not binding on the government to implement.
This did not stop several Tory MPs from speaking passionately during the debate.
This included Andrew Lewer, MP for Northampton South (pictured, above), who sits on or chairs many of the key all-party leasehold, fire safety and rented sector parliamentary groups that have been examining the scandal.
“We are well aware of the impact that this crisis is having on the sector, including on buy-to-let landlords, who have been left trapped, as a result of EWS1 forms, with properties that are not safe, not sellable and not remortgageable.
“As an NRLA survey outlined last year, of the landlords who were required to carry out an EWS check on their property, 42% were unable to secure an EWS report, stagnating movement on their property.
“Although I recognise the good intentions of these checks, a lack of [engineer] availability is a problem, as Ministers are aware.
“Despite the Government’s hard work to rectify the outstanding issues, these forms continue to hamper the movement of property, squeezing a market already facing an uphill battle.”
EWS forms
External Wall System (EWS) forms are the paperwork required by leaseholders to sell or remortgage their homes if their property has cladding.
They are produced by a fire safety engineer and identify whether remedial work is needed on a tower.
During the debate Labour criticised Ministers for the ongoing lack of information about how many properties are affected by the cladding scandal; fund an urgent programme to make more of the properties involved safer; and for the cost to fall on freeholders, tax-payers or contractors, not leaseholders.
“These leaseholders bought their homes in good faith only to find themselves victim to years of corporate malpractice, government inaction and a broken leasehold system,” says Labour’s shadow housing secretary Thangam Debbonaire (pictured, top).
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Convert to HMO or not?
I have a reasonably good-sized mid-terrace property coming vacant. In the past, I let this to families.
The ground floor of the house has a large front room, large mid-room and a large kitchen. Upstairs there are two medium-sized bedrooms
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HM Treasury dodges key question during stamp duty holiday extension debate
Landlords are used to the current government doing policy U-turns but not when it comes to extending the stamp duty holiday.
Thousands of landlords are waiting to see if their buy-to-let purchases go through before the current stamp duty relief for homes bought under £500,000.
But a debate in parliament last night which many had hoped would see HM Treasury make an announcement on either extending or tapering the stamp duty holiday instead ended up being a talking shop.
After hearing from half a dozen MPs including Diane Abbott, Kevin Holinrake and Labour’s official representative at the debate, Abena Oppong-Asare, many of whom supported an extension or tapering of the stamp duty holiday, Financial Secretary to the Treasury Jesse Norman then replied.
E-petition debate
The meeting, which was held online after traditional debates prompted by e-petitions singed by more than 100,000 people were suspended last week by Jacob Rees-Mogg, heard that: “As the minister for government tax policy are aware of the strength of feeling on this issue, and I fully understand the frustrations of those who are in the process of purchasing a property and are concerned about the delays that they face,” he said.
Norman, echoing several other MPs comments, said that he realised hundreds of thousands of sales were being held up by the overwhelmed surveying, conveyancing and lending industries, which have seen a 50%+ jump in sales since the duty holiday was announced six months ago.
But the disappointment of the thousands watching the online debate, Norman said he was unable to comment directly on the Chancellors plans. These are to be reveal during the next budget statement on 3rd March.
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Campaigners call for £288m Covid rent debt fund to help landlords and tenants
Generation Rent has called on the government to set up a Covid Rent Debt Fund to help landlords with struggling tenants claim up to 80% of their rent arrears.
Ahead of a House of Lords debate on the recent extension of the evictions ban, the housing pressure group wants the Chancellor to provide £288m from the Budget to clear rent debt and keep half a million private renters in their homes.
Under Generation Rent’s proposal, the government would clear renters’ arrears, keeping them in their homes, while allowing landlords to apply for compensation up to 80% of the total rent due since March.
This afternoon’s debate on the extension to the Christmas truce – which stops bailiffs from evicting tenants until 21st February except in limited circumstances – Labour’s Lord Kennedy and Liberal Democrat Baroness Grender have tabled ‘motions of regret’ which criticise the new regulations for reducing the arrears threshold, that means tenants with more than six months’ arrears are still vulnerable to eviction, and highlight the financial challenges facing renters.
Failure
Generation Rent argues that government action has failed to address the underlying £360m of rent arrears which is putting homes at risk.
It asserts that while the idea of simply cancelling rent has raised concerns about landlords’ property rights, legal experts have backed its proposal as a proportionate way of dealing with debt that balances the interests of landlords and tenants.
Director Alicia Kennedy (pictured) says these rent arrears will be impossible to pay back even when the economy recovers.
“While most tenants are not at immediate risk of eviction, they are still being forced to pay the price of the pandemic and face the prospect of homelessness without further action,” she says. “To get these people back on their feet, we need Rishi Sunak to step in and clear these arrears with a Covid Rent Debt Fund.”
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