Miliband's net zero targets threaten to trigger surge in evictions
Ed Miliband today unveiled proposals that would require rental properties to achieve an energy performance certificate (EPC) score of C by 2028 for new tenancies.
The targets would leave landlords less than three years either to upgrade their homes' efficiency or be banned from letting tenants at all. But brokers have warned that it is 'nonsense' to expect landlords to meet the targets before the deadline.
Announcing the proposals, the Energy Secretary claimed tenants had been 'abandoned and forgotten as opportunities to deliver warm homes and lower energy bills have been disregarded and ignored'.
But Anthony Emmerson, of broker Trinity Financial, said: 'It is complete nonsense to think that most rental properties could have their EPC rating increased to achieve a C level over such a short period of time, partly because we have an old housing stock, but also because we simply do not have enough contractors to do the huge amount of work required.
'Even if it were possible, it would cost tens of thousands to fix many of these properties and also mean many tenants needed to move out of the property while the work is completed.'
Timothy Douglas, of estate agent trade body Propertymark, also warned of a 'huge risk' that landlords would seek to use break clauses to empty properties before carrying our renovations.
He added: 'Many landlords will feel pressure to get the works done. They will either throw in the towel completely, or there is going to be upheaval for tenants.
'There will be short-term pain for tenants and landlords until it's all relieved – short-term pain for long-term gain.'
Renters' rights groups welcomed the proposals but warned that Labour's 'worthy ambitions could be left in ruins' if the party did not amend the controversial Renters' Rights Bill 'to protect renters from eviction and rent rises' due to property improvement targets.
Rents already hit a record high of £1,344 a month last year as landlords sold up in response to tougher regulation and tax rises. An estimated 8,425 households in England were served eviction notices in the three months to September, according to Ministry of Justice figures, piling more pressure on Britain's rental crisis.
Under current rules, a property must have a score of E to be let to tenants. Less than half of all private rental homes in Britain currently have an EPC score of C or higher.
Labour estimates a typical landlord would have to spend between £6,100 and £6,800 to comply with the targets.
But costs for upgrades could reach as high as £15,000 per property under caps proposed by ministers, with an 'affordability exemption' of £10,000 which could be applied based on lower rents of council tax.
Michelle Lawson, of broker Lawson Financial, said: 'The costs to implement such changes could be significant for landlords with little to no return personally.
'Are there also enough suitably qualified trades to install any upgrades? This is just going to further push landlords away from the beleaguered private rental sector by them selling up and exiting and then further detrimentally impacting supply and demand.'
Chris Norris, of the National Residential Landlords Association, said the cost of upgrading rental homes would 'see significant costs passed on to tenants as landlords recover the very significant potential costs of retrofit'.
He added: 'This will inevitably be made worse if there is a rush to carry out more work on more than 2 million rented properties in four years or less, there simply isn't enough capacity in the system to prevent costs soaring.'
Labour is separately consulting on long-awaited reforms to EPCs. A poor grade can knock thousands off a home's value and a Telegraph investigation found that the assessments were often based on 'guesswork' and that inspectors with just three days' training.
The results of the consultation are due next year. Suggestions include rebalancing assessments to favour homes with smart meters and heat pumps.
The number of buy-to-let properties for sale in London hit a 10-year high last year as landlords fled in response to tougher regulation and Labour's capital gains tax raid.
Experts said a rising number of investors were abandoning the sector in the face of higher mortgage rates, more red tape and the threat of further tax reforms. Under Labour's Renters' Rights bill, landlords would need to apply for a court order to evict a problem tenant. The ban on Section 21 evictions means it could take a landlord up to 55 weeks to regain access to their property due to current court backlogs.
Paul Shamplina, founder of the Landlord Action campaign group, said: 'Landlords are leaving in their droves and the fear of the Renters' Rights Bill and the ending of Section 21 and the severe court delays landlords are suing it before losing it.'
The Government was approached for comment.
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