Are You MEES Ready?

28th September 2016

We are now 18 months away from the next phase of the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 which will see the implementation of the Minimum Energy Efficiency Standards (“MEES”).

Landlords should be preparing for this now if they have not already started to.

  • From and including the 1st April 2018 a landlord cannot grant a new residential or commercial lease or extend or renew an existing lease if the property does not meet the MEES.
  • From and including 1st April 2020 a landlord will not be permitted to continue to let residential properties that do not meet the MEES.
  • Finally, by 1st April 2023 a landlord will not be permitted to continue to let commercial properties that do not meet MEES.

The lettings caught by the legislation include assured tenancies, regulated tenancies and commercial leases unless you can fall into one of the exemptions, but excludes properties sold on leases of more than 99 years and owner occupied properties.

The current MEES is band E on an EPC. Therefore initially any property with a band F or band G rating that is not exempt will be caught. However, it is expected for this to be reviewed in the future and the threshold increased.

Buyers of investment properties should be paying attention to the EPC rating to ensure any future lettings of the property are not prevented without additional expenditure of trying to make the property more energy efficient.

Sellers may come under pressure to reduce prices to factor in the cost for making the property MEES compliant.  Energy efficiency standards of certain properties are likely to have an impact on marketability, valuations and price negotiations.

Owners will need to consider whether their properties will need works undertaken to them to continue to be lettable in the future.

Failure to comply could lead to fines of between £2,000.00 to £150,000.00.

If you wish to discuss this article in more detail or you have any property related questions please contact Simon Tennant.

Simon Tennant