EPCs increasingly important in 2023

EPCs – how important will they be in 2023?

If you’re thinking of selling in 2023, you might imagine your first step would be to contact estate agents for opinions on value. You might be surprised to learn I’m going to advise getting your EPC (Energy Performance Certificate) done first.

 

Once an overlooked vestige of Home Information Packs, EPCs are now taking on much more importance – both in the minds of potential buyers but also their mortgage lenders. With revamped Domestic Minimum Energy Efficiency Standard (MEES) Regulations also on the horizon for 2025 for lettings EPCs, investors in particular are becoming far more sensitive to your property’s EPC score. However, with energy prices as they are at present, so are all buyers.

 

Some mortgage lenders are already adjusting rates to offer better deals to “greener” properties too – these include Barclays, Nationwide, Nat West and Virgin Money. On the other side of the fence, certain buy to let lenders are refusing to lend on properties under a C rating in anticipation of the MEES regulation changes.

EPCs

 

If you don’t have an EPC on your property already (they were introduced in 2007 and are valid for ten years), start by researching similar homes on your street with one ( www.gov.uk/find-energy-certificate) to see what you might do to score some quick wins and improve your rating. Extra loft insulation, heating controls (room thermostats) and low energy lighting are three relatively inexpensive and speedy renovations you can do to bump up your points tally.

EPCs

 

Then you can get an assessor (getting-new-energy-certificate.service.gov.uk/find-an-assessor) round to check over your home and produce your EPC. Bear in mind that listed buildings are currently exempt from needing an EPC but it may still be a good idea to get one to be 100% transparent for potential buyers. At present, for properties in England and Wales the average energy rating is D and the average energy score is 60.

 

Knowing your EPC rating helps your agent to target the right type of buyer for your home. A good enough score will now attract more buyers and might well make a difference in value. EPCs also include recommendations on what could be done to the building to improve its energy rating so buyers can decide on future renovations to further reduce bills.

 

EPC certificates can be added to your Rightmove advert, either just as the scores graph or as a fully downloadable report. It is always worth asking your agent to add the full report so buyers can do as much homework as possible before they decide to view.

 

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EPCs

For info, regarding the updated MEES Regulations for let properties suggested for implementation from April 2025 onwards, the proposed changes are;

 

  • Minimum EPC rating to be raised from E to C.
    The plan is to enforce this from 1 April 2025 for new tenancies, and from 1 April 2028 for existing tenancies.
  • Cost cap for exemptions to be raised from £3,500 to £10,000 per property
    The government says this would be sufficient to bring more than 90% of D-rated properties up to a C rating, as well as nearly 60% of E-rated properties. It’s not clear whether existing spending would count towards the new cap.
  • “Fabric first” policy to be introduced
    This would control in which order work is carried out, so improvements to the fabric of the building (ie insulation, windows and doors) must be done before additional measures such as new heating systems are installed.