Brexiteer MPs campaign against Net Zero EPC targets

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  • Codger
    replied
    Reform uk are sounding sceptical about net zero. Lets see how the do in elections, hopefu lly they will frighten the gov!

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  • Turbine Terry
    replied
    Originally posted by L4NDLORD View Post
    I am not interested in being "shaken out". We have been in this business so long that there would be a hell of a lot of tax to pay on liquidating. There will be a work around. One of the peculiarities of letting houses to local authorities and housing associations is that they do no require an EPC to let in persons in housing need. So those in greatest fuel poverty get no benefit from all of this.........

    Don't worry – despite some suggesting that the proposed EPC regs changes will be the end for the PRS sector and that we shouldn’t fight anymore but instead just lie down and accept our fate, a much more likely scenario is that few landlords will actually need to sell up unless they want to and/or aren’t prepared for a little extra effort. It is far from the fait accompli (bonnet de douche, Rodney) that some are suggesting. My research leads me to form the opinion that any new EPC regs will much more likely than not include a mix of, or all of: a maximum of a £10k cost cap, government grants funding maybe 67% of upgrades akin to the recent Green Home Grant - but without the need to use Trust Mark installers, meaning there will be a more plentiful supply of tradespeople; a new EPC algorithm that is more sympathetic to older/Victorian/solid wall/electric heated properties; extra support or exemptions available for the cheapest properties/lowest rents; and many other exemptions.


    Like you say CGT has to be considered – especially if landlords have remortgaged and released a lot of, or all of the equity then, selling up can result in a larger CGT bill. Sometimes so large that it could leave virtually no equity, and in worst cases not even enough equity to pay the CGT bill if the property was purchased many years ago and more recently remortgaged to the hilt at a high LTV. I am not in a high LTV/poor CGT circumstance, but it makes zero sense for many to sell and lose all the rental income and be left with close to no equity/cash, or even actually be facing a CGT bill that the equity released from the sale of the property won’t cover.


    Due to their personal circumstances some may feel that all the deck is stacked against them (even though the new EPC regs are not yet even known or finalised) and some landlords personal circumstances may well mean that they wish to sell up. I feel that the impression some landlords keep giving at seemingly every opportunity though is that the writing is already on the wall and that the whole PRS is not worth it at all anymore and so they seem to be advising us all to sell up as soon as possible. Perhaps such advice to sell is being given so that the advice givers can feel more validated in their own personal decision to sell as they are still not yet fully confident that they are making the correct decision by selling. That is, to an extent, understandable human nature, but a lot of the opinion and ‘advice’ I am reading is perhaps given somewhat disingenuously at times and I feel it isn’t that far removed from the ‘if I am going down I am taking you all with me’ mentality. I and many others will consider selling to be ‘going down’ to a certain extent as most will not receive the income and equity increases that they do in property if they invest elsewhere. Indeed, many do not have the knowledge or risk appetite for alternative investments at all, so are quite stuck with being a landlord, and happy to be so.


    Before making or advising on life changing decisions a more balanced view is needed and IMO the deck is not all stacked against us: look at the continued and expected rising property prices allowing us, if we wish, to release plentiful equity to pay for any EPC works; look at the drastic and constantly worsening lack of supply in the PRS giving us record rental income (10% to 20% up in one year for my properties) look at the cheap and plentiful supply of BTL mortgages on offer, look at the flexible working hours, and lifestyle BTL’s gives us. Again, there are hardly any other ways in which many of us would be happy to invest our cash and so there will be plenty of us who will therefore adapt to whatever is thrown at us and through planning will continue to survive and become even more profitable and so be even more able to easily adapt and survive the next time times get tougher.


    Having survived the constant changes of the last 20 years I know that being a landlord is not for all though, and that selling up is totally understandable; the constant Increase in regulations and tax squeezes in the sector is clearly causing many landlords to throw in the towel. But for those who stay a shrinking PRS can be a good opportunity (less competition, higher rents, good supply of properties to buy). So with my hard faced business hat on (faces, hats – sorry for the mixed metaphor) hearing about other landlords throwing in the towel does not - once I have noted and considered the reasons that they are doing so - dismay me as a shrinking PRS has benefits to those of us who plan to say: we can pick up reasonably priced quality properties that may only need a maximum of a £10k EPC cost cap spending on; we can then rent them out for ever higher rents (as the PRS shrinks further).


    It is not an exaggeration to say that the PRS is currently a vital part of UK society. The government is already at the point where it is being advised by councils to stop being so hard on landlords so as to limit the PRS shrinking further. Even before the shrinking PRS started it already had major issues housing people, and the associated homelessness. The more landlords that sell up will only exacerbate the speed with which the government will have to step back in to limit the PRS shrinking too much, or indeed even find ways to reverse some of the decline – extra rental stock must come from somewhere and the government isn’t seemingly in any rush to increase building of new social housing stock. Indeed, some councils are complaining that new social house building has had to be postponed so that the cash can be spent upgrading the existing supply for Net Zero 2050 policies. Anti-landlord policies can only go so far and it is clear that they are already becoming excessive.


    It is also becoming increasing clear that Net Zero 2050 polices are already starting to frustrate the population and the policy is gathering pace as being seen as a home goal and the next poll tax disaster. The government will likely keep the headline 2050 pledge in some form, but it will need to tweak its component policies when they will start to cause major unintended consequences (such as huge increases in homelessness). As we all know it’s all about the votes for those in Whitehall and being harsh on landlords might be the fashionable thing to do, but when policies have the potential to upset one of the main stays of a well ordered society, then policies will adapt. It only takes a 10 minute read online (although I have spent considerably longer) to see all the chatter from industry bodies, some MP’s, landlords and tenants alike concerning the major effects that making too many landlords leave the sector will have. U-turns are abound in politics, but the proposed new EPC regs don’t even need anything like a U-turn – the government can continue with its headline EPC policy of band C, all it needs to do is incorporate a few sensible measures to limit the unintended consequences and the government can look good and stick to progressing its Net Zero 2050 without causing major knock on effects for society, like worsening homelessness etc. IMO it’s all quite Simples (sorry).


    If the government could hurt landlords without unintentionally hurting others in society then they could be as hard as they liked with any new EPC regs and the general public would be behind them. It is very apparent though that successive new PRS guidelines have already hurt the sector AND tenants alike and increased homelessness and caused major issues for councils. What with the proposed Renters Reform Bill on the cards landlords are already being heavily hounded. That is why I (and many others much better placed to offer opinion) believe that any new EPC regs will be designed so that most landlords are able to comply reasonably easily if they want to.


    The purpose of this post was certainly not to advise landlords to not sell up (indeed, as stated above I may well actually benefit if many sell ) as without knowing an individuals full detailed circumstances I am not in any position to advise either way. My aim is to balance out some of the negativity and doom mongering (great word). I deem this balancing to be necessary as I believe that some landlords – ones who are perhaps less experienced in property and/or running a business, or have little equity - may be panicking unnecessarily after reading all the negativity. It may well be that selling turns out to be the best option for them, but they may be deciding to sell up without first giving careful consideration of the full picture. I am not recommending that anyone should either stay or sell, I am purely trying to ensure that both sides of the ‘should I stay or should I go’ debate/discussion are represented as evenly as possible.

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  • Hudson01
    replied
    Ref the above, i agree, i too do not like being bullied to leave the sector but when all the deck is stacked against you it would be foolish to continue to play and expect to come out a winner. It is not a game of will, it is a financial decision and nothing more, if i need to spend 15k plus to get my properties to a C then it's simply not worth it, but this only relates to my circumstances, yours and others willl be different, I chose long ago not to deal with tenants from the local authority side of things, i simply do not want the constant hassle and other issues that my friends who do dabble in that side of things get. If the govt stick with this, and i genuinely think they will, then every single one of us who choose to leave should look at it as a natural end in the PRS...... if that is the best decision for us financially and for our current life plans then so be it, it is not to be fought, it should be welcomed. The best laid plans of mice and men ..........

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  • L4NDLORD
    replied
    I am not interested in being "shaken out". We have been in this business so long that there would be a hell of a lot of tax to pay on liquidating. There will be a work around. One of the peculiarities of letting houses to local authorities and housing associations is that they do no require an EPC to let in persons in housing need. So those in greatest fuel poverty get no benefit from all of this.........

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  • Hudson01
    replied
    As the above post...... a very sensible approach and one i am adopting, i cannot see how the govt can roll back from all this, they have made a concrete undertaking for net zero by 2050, they have said this to the whole world, they will not go back on it, so what are the options...... not many when you look at them and we are one of them, the public have no sympathy for LL's, in fact most believe the hype that we are rolling in money and can afford it, we will get no help from the general public.

    I am banking on my properties not being able to be let from the 31st Dec 2028, i am looking at an eviction and selling plan based on this assumption, and i also can see a glut of older properties/flats/electrically heated places being all sold within a few years of each other, the more forward thinking LL will see this and take action, i hope i am one of those.

    As said before, this really is not the end of the world, it is simply a change in my financial planning...... at least i have that option.

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  • jpucng62
    replied
    Originally posted by L4NDLORD View Post
    There are some big changes coming......It will be more favourable to solid wall properties than the current regime
    The problem with waiting & hoping is that if the changes aren't what you are hoping for you may be left with needing to sell several properties quickly. If this is multiplied by many LLs doing the same thing the property market may take a hit or Victorian properties become difficult to sell and many LLs taking a hit on price & CGT.

    2028 isn't really that far away, especially if you have tenants you are likely to need to evict. I'm not waiting for the Govt to realise they've got it wrong - I am starting to sell now but will keep everything under review as we head towards 2028.

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  • L4NDLORD
    replied
    There are some big changes coming. At present EPC focuses on cost of heating not environmental efficiency. Dont panic Mr Mainwaring. It might yet be alright. However, I would recommend people keep chipping away at the target, improving efficiencies where they can and pause for breath when the new scheme comes out. It will be more favourable to solid wall properties than the current regime

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  • Codger
    replied
    We need a referendum on net zero. I would call it netzit!

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  • Hudson01
    replied
    Nice to see some MP's have common sense, what Brexit has to do with anything is beyond me. It not just LL's that are bothered by the ban on gas boilers in 2035.... anyone currenlty with one is bothered (me included), which is why not long after 2032 i will be looking to replace my current boiler with the very best one i can get and ride it out until i meet my maker. I have posted on another thread about this being akin to the introdution of the Poll Tax and the Iraq War, both being totally campaigned against by the public.... and both happened anyway ! I have a very strong feeling the govt will not listen, we are heading for a C EPC. I am not angry about this, all we can do is plan, if the situation alters that the plan was based upon, the plan changes, it's not a big issue, i will just cash my chips in and move on, i am near retirment age anyway so will just go on more holidays !!! I have enough income without my BTL's, but it will mean my tenants will have to find something else, they have been with me a while now and i do regret that aspect of it, but it's beyond my control.

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  • jpucng62
    started a topic Brexiteer MPs campaign against Net Zero EPC targets

    Brexiteer MPs campaign against Net Zero EPC targets

    Story here about a new campaign that might interest LLs:

    https://www.landlordtoday.co.uk/brea...ro-epc-targets

    Although their main focus is on the costs to the general population of the Govt's Net Zero policies, EPC C is a part of this and is possibly a good way to raise awareness of the issues affecting LLs & tenants over the next few years.

    The web site is here:

    https://www.netzerowatch.com

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