There are new rules for letting residential property. If you have ever granted an Assured Shorthold Tenancy (AST) or intend to grant one in the future, then this will apply to you.
EPC requirements and listed buildings – ASTs granted on or after 1 October 2015
Typically, an AST is for a "fixed term" of six months, and after this period the tenant remains in the property under a statutory continuation tenancy. An attraction of an AST for landlords is that they can serve a section 21 notice to quit; this provides a tenant with two months’ notice to vacate the property provided that the two months’ notice period does not expire before the end of the fixed term.
The new rules state that a landlord’s notice to quit is invalid unless the landlord has given the tenant three documents before the grant of the tenancy:
- An energy performance certificate (EPC) for the dwelling.
- A copy of the current gas safety certificate.
- A copy of the Department and Communities and Local Government’s pamphlet How to rent: the checklist for renting in England (the edition current at the time of granting the tenancy).
However, if you own and let a listed building, do you still need to provide the tenant with an EPC?
The general consensus appears to be that listed buildings are exempt from the requirement to provide an EPC to the tenant before the grant of a tenancy. However, there is no express exemption in the regulations for listed buildings and the regulation dealing with this point is not clear.
Listed buildings are exempt but only “insofar as compliance with certain minimum energy performance requirements would unacceptably alter their character or appearance”. The test for "certain minimum energy performance requirements" is not defined; compliance is therefore difficult. The Government has not clarified the position but the general view (for example, from government and public body websites) appears to be that listed buildings do not need an EPC. In conclusion, is a landlord required to produce an EPC for a listed building prior to granting an AST? The consensus appears to be "no", but this is unfortunately not certain.
Right to rent – ASTs granted on or after 1 February 2016
From 1 February 2016, private landlords in England will need to determine new tenants’ right to be in the UK before allowing them to rent out their property. This will include landlords who take in lodgers and tenants who sub-let their room. The requirement also includes the particularly onerous task of ensuring that a tenant’s right to be in the UK continues throughout the tenancy.
The Government has published guidance on the requirements to assist landlords in carrying out the checks required: Home Office: A short guide for landlords on right to rent. The penalty for breaching the requirement is up to £3,000 per tenant. For more details see our Property Matters blog here.
Smoke and carbon monoxide alarms – ASTs granted in the past, present or future
From 1 October 2015, all private landlords in England need to comply with the Smoke and Carbon Monoxide Alarm Regulations 2015. The Regulations act retrospectively and will therefore include any ASTs granted before 1 October 2015. Regulation 4(1)(a) states that:
(i) "a smoke alarm is equipped on each storey of the premises on which there is a room used wholly or partly as living accommodation" (a fine of up to £5,000 could be charged if this is breached); and
(ii) "a carbon monoxide alarm is equipped in any room of the premises which is used wholly or partly as living accommodation and contains a solid fuel burning combustion appliance".
For ASTs granted on or after 1 October 2015, the landlord must check that each prescribed alarm is in ‘proper working order’. For more information, see our client briefing here.
The above new rules are likely to affect many landlords who grant ASTs; the rules serve as a good reminder to landlords that the law in this area is fast-paced and this emphasises the importance of regularly checking for updates on this area of law. If you would like any more information about any of these topics, please visit our Property Matters blog or contact Marie Barber or another member of the Agriculture and Estates team.