thomas
 
Time
mailing listcontact usfavourites
saleslettingsMortgages Investments

ADVICE TO THOMAS CLIENTS
ITS HIP – AND IT’S HAPPENING!

EPC and the lettings market 1st October 08 impact 

The Home Information Pack duties apply to the person responsible for marketing the home - this will usually be an estate agent.

Caroline Flint, Housing and planning Minister has extended First day marketing to 31 December 2008
Provided that the pack has been requested in writing (and is accompanied by the appropriate payment or an undertaking to make the payment) and it is expected to become available within 28 days – marketing can start without a Pack. The duty to provide a Pack does not then arise until the energy performance certificate (EPC) is obtained.

 

Once the EPC is obtained, you should ensure that the Pack is made available as soon as possible. At this point the pack must include at least the following documents:

  • Index

  • EPC

  • Evidence of title (if registered)

  • Sale statement.

  • Searches (Local authority, Land Registry, Drainage & Water)

The Pack might still exclude the following required documents at this point if these have not yet been obtained:

  • Evidence of title (if unregistered),

  • Leasehold/commonhold information

In such cases you should continue to make reasonable efforts to obtain the missing items and add them as soon as possible. Following the end of the temporary period, the main duty is to have a Pack that complies with the Regulations in your possession or under your control when any marketing activity occurs, including marketing activity carried out before the property is actually put on the market.

 

Properties marketed before the commencement date
Properties that are genuinely on the market before the commencement date will not need a Pack.

  • 1 August 2007 for sales of homes with four or more bedrooms

  • 10th Sept 2007 for sales of homes with three or more bedrooms

  • 14th Dec 2007 for sales of all properties.

 This exemption will apply for as long as marketing continues but the Government may appoint a date at which all properties on the market will be subject to the HIP duties, regardless of when they were first marketed.

Penalties and enforcement
The Pack duties will be enforced by local authority Trading Standards Officers. They will be able to give advice and warnings, as well as issuing penalty notices. The fixed penalty has been set at £200 initially, and can be repeated if a breach is repeated. Marketing a property without a Home Information Pack, or an incomplete Pack, will render an estate agent liable to a penalty notice.
Estate agents should also be aware that a breach of the Pack duties will be treated as an 'undesirable practice' under the Estate Agents Act and must be notified to the Office of Fair Trading (OFT) as such. An estate agent who consistently flouts

he Pack duties will therefore risk a banning order from the OFT.

St October 2008 landlords Guidance for lettings

  1. Energy Performance Certificates (EPC) will be required whenever a building in the social or private rented sectors is let to a new tenant.

  2. A building can be: the whole of a building; or part of a building where the part is designed or altered to be used separately. For residential purposes, ‘designed or altered to be used separately’ describes a unit that is self-contained, meaning that it does not share essential facilities such as a bathroom/shower room, wc or kitchen with any other unit, and that it has its own entrance, either from outside or through common parts, that is not through another dwelling.

  3. The purpose of an EPC is to show prospective tenants the energy performance of the dwelling they are considering renting.

  4. EPCs are valid for 10 years and can be reused as many times as required within that period. It is not necessary to commission a new EPC each time there is a change of tenant. However, once a more recent EPC has been produced for a dwelling, it will always supersede an existing one. Thus, where a number of EPCs are obtained for a property within the 10-year period only the most recent one is valid.

  5. The landlord must commission an EPC and ensure a copy of it, including the recommendation report, is available (for inspection at least) free of charge to prospective tenants at the earliest opportunity. As a minimum, this should be when prospective tenants are first given written information about a dwelling or are arranging to view it, and before any rental contract is entered into. A copy of the EPC (rating and recommendation report) must be given free of charge to the person who ultimately becomes the tenant before any rental contract is entered into

  6. An EPC is not required for any property that was occupied prior to 1st Oct 2008 and which continues to be occupied after that date by the same tenant.

  7. In instances of lettings where marketing activity is initiated prior to 1st Oct 2008 an EPC is only required if the property continues to be offered for let on or after 1st Oct 2008.

  8. The landlord should maintain an auditable trail of communication to show: whether a tenant has agreed to receive an EPC electronically; and whether they have in fact received it.

  9. If a landlord already has an EPC for a property, for example because it was recently purchased and the EPC was part of the Home Information Pack (HIP), this EPC can be used for the subsequent rental. EPCs are valid for 10 years from the date of its production for rental purposes but only for 12 months if it is to be used for a HIP related sale.

  10. If the landlord has failed to provide an EPC to a tenant, or fails to show an EPC to enforcement officer (An authorised Trading Standards Officer TSO) when asked, Trading Standards can issue a notice with a penalty charge of £200.00 per dwelling. In addition to paying the penalty notice, the landlord will still have to provide an EPC to the person who has become the tenant.

  11. A pro-active approach to EPC compliance means having them in advance of the trigger points at which they would be needed. For example, if a landlord has a block with a high turnover of tenants, then producing EPCs in advance of the requirement will mean that these are on hand to give to new tenants as they are offered accommodation and will reduce any impact on void times. It should be borne in mind however that a proactive approach typically requires surveys of tenanted properties and if any difficulties are encountered in gaining access, the need to make repeat visits could increase costs.

  12. A reactive approach means producing EPCs as and when they are needed. If there is no EPC in place when a tenant leaves, then one will need to be produced before the accommodation is next made available to prospective tenants.

  13. A landlord cannot charge for the provision of the original EPC. However it is permissible for a tenant who has already received the EPC to be charged for the provision of a copy document.

  14. Where a tenant sub-lets a dwelling, the responsibility to make the EPC available lies with the sub-leaseholder.

  15. There may be occasions when it is possible to offer a dwelling for rent before the EPC is available. However this should not be the norm. The landlord will be expected to have made contact with a DEA and commissioned the EPC with a view to receiving it within two weeks of the date it was commissioned.

If the tenant wants to purchase the dwelling they rent, the same EPC can be used. This is because it is a non-

    • marketed sale not affected by the HIP Regulations. An EPC is required but this can be up to 10 years old. However, if the dwelling is also being placed on the open market, the EPC must be no more than 12 months old because it is affected by the Hips Regulations.

    • If the agreement between the parties expressly allows for a short period of holiday occupation only and no intention to create a tenancy can be inferred, then an EPC is not required.