Being energy efficient is becoming increasingly popular since the surge in utilities bills – and not only does it save valuable money, but it can help to reduce our impact on the environment too.
This is of particular concern to landlords, who have no control over how and when energy is used in the homes that they rent out – however, there is some good news on the horizon.
Different options available
There are now a number of ways that landlords can improve the energy rating of the homes they let out through council backed grants and loans. A word of warning though, the type of funding, and the amount, varies from council to council. There are also those who sit on town councils who feel that landlords shouldn’t have access to this sort of money because they have built up a good amount of equity in the property.
Luckily for landlords and the residents in their houses, there are others who feel that having access to these funds can only improve the lives of the tenants saving them from chilly flats and high heating bills.
There are grants available to improve energy efficiency, HMO conversion and the renovation of empty houses for the use of tenants. However, the funding available is complex and each council has a different criteria in place for the awarding of the grant to a landlord. For example, some are means-tested, while others target landlords who have secure tenants in place.
HIPs, hip hooray
After the Home Information Packs (HIPs) were introduced, it has become a lot easier for houses to be handed an energy rating – and a recent study has shown that an average four-bedroom house only achieves an energy rating of E. This is not good, especially when you consider that the worst rating is G.
Making a home energy efficient can be an expensive task, but if you live or own a place for long enough, it does make economic sense to take advantage of any grant that enables you to do so.
For example, in a semi-detached house it would cost around £300 to insulate your loft – and would have a potential saving of £150 a year, with a carbon dioxide saving of 620kg per year meaning your investment would be made back in just two years. It could also boost the value of the place, and improve its energy rating.
In 2006, the government introduced a new law that made it compulsory for a landlord to licence their place if it fell into a HMO status. A HMO home is one that is occupied by three or more people, forming more than one household or if the people in the house share bathroom or kitchen facilities with other tenants.
Lots of money
The HMO conversion grant can be worth up to £30,000 and is used to bring a property in line with minimum HMO standards, which include the following:
- Appropriate fire precaution and safety measures
- A minimum standard for fixed amenities such as kitchen and bathrooms
Again however, the grant awarded varies from council to council as they have different rules surrounding the HMO grant.
The empty property grant is available for those who own a property that has been empty for more than one year. Once this happens, you can let it to council nominated tenants on a long term (usually 5-10 year) lease. Once you do this, you could be eligible for a grant that covers 50% of your renovation work, including any heating or insulation work.