This actually could be problematic for many, as a modern boiler, energy efficient lighting and double glazing might only achieve a high D rating. Additionally, due to restrictions imposed by freeholders and certain practicalities, flats could be particularly problematic to address.

It is estimated that this could affect between 2.5m and 3m investment properties:

• Penalties for non-compliance can be as much as £30,000
• The energy improvement investment cap will be raised from £3,500 to £10,000 *

*Currently if compliance is impractical due to cost, inability to gain a freeholder’s permission, due to ‘improvements’ being detrimental to the value of the building, or the only steps that can in theory be undertaken cannot be undertaken due to the specifications of the building then an exemption can be obtained. These exemption certificates last for 5 years and it will be interesting to see if all of these exemptions are retained going forward.

Against a current backdrop of supply chain delays and increasing costs, landlords should review their portfolios in good time to ensure that a fully planned schedule of works can be considered, costed, funded and implemented in a way which is economically viable across the coming years.

This article is from the latest issue of our Construction, Land and Property Bulletin - Spring 2022. To receive future copies of any of our newsletters directly to your inbox please visit our preference centre and register your interest.