New Landlord Regulations – Heat Networks & Service Charges – September 2015 | Quantity Surveyors

Published 814 days ago
New Landlord Regulations – Heat Networks & Service Charges – September 2015 | Quantity Surveyors

New Landlord Regulations – Heat Networks & Service Charges – September 2015 | Quantity Surveyors:

Disputes are a common occurrence when it comes to a landlord and tenant relationship. These disputes can be over something very small pertaining to something the tenant should be in charge of taking care of all the way to the big things like structural problems within the building. Whatever the case may be any landlord who has been leasing anything for any length of time will be faced with a dispute.

Regulation Changes

Many multi-let buildings rely on central heating systems for the heating of the building as well as the water supply. New regulations are making their rounds through these multi-let buildings. The regulations are laid out by the Heat Network in their 2014 standard. Landlords are required to comply with these regulations no later than 31 December 2015. If the landlord does not make his or her changes by that date they are to report to the National Measurement and Regulation Office. They are to give detailed locations and the type of building the heating system is used for. The landlord is also required to provide an estimate of their yearly heating consumption.

An upkeep of these regulations is required to be submitted on a regular basis every four years. Although some of the aspects of these new regulations are clear, the case of whether amendments are able to be made. It is also not clear if a new landlord must submit a new notification or if they are able to simply pick up where the previous landlord has left off.

Landlords are also required to ensure the reliability of the meters installed. Where in the past landlords were able to offer rough estimates for their tenant’s bills, these new regulations call for more of an accurate reading. The meters must be able to measure the true consumption of energy for each and every tenant with no estimations within the building.

Service Charge Regulations

New service charge regulations are making their rounds in addition to the other provisions. In the new rule a service charge must be implemented. This regulation presents a challenge for many landlords. Upon signing a lease the tenant is responsible for any charges within the lease and then that lease becomes a binding contract that is not to be broken by neither tenant nor landlord for the duration of the lease. Most landlords do not have a standard date that they renew all leases because people move in and move out at different times and changing the service charge before the lease is up will present a conflict with the current contract.

It will be easy to implement these changes with new lease agreements, but it is not clear in the regulations how the landlord is to go about adding the service charges into the lease agreement. It is also unclear as to how the service charges should be allotted. Standard service charges are based primarily on the consumption of the individual unit; however the new regulations have not done a very good job of making that aspect clear.

Cost Effectiveness

The cost effectiveness of service charges is also coming under fire. Some instances it is not feasible to regulate the average £70 or less per annual fee for each tenant. Damaged or faulty meters will give false results, but these questions are not answered in the new regulations. It should also be noted that it may not be cost effective to install new meters, thermostats, radiators, or valves within the building. Each building is different in accordance to when it was built and it simply may not be feasible to install these items.

Final View Point

Where the new regulations look to make every building as cost effective as possible, it does little when put into action. The overall cost of overhauling a building depending on the age can be astronomical. Basic upkeep on a property is costly enough without adding these extra regulations to it. If the heating system within the building is effectively calculating each tenant’s heating consumption there is little need to further regulate and change the system.

The fines for not conforming to these new regulations by 31 December 2015 are up to £5,000 for each violation with additional daily penalties of £500 until the regulations are met. In addition to these fines the landlords overall reputation also comes into play. The shaming of certain properties because of noncompliance puts pressure on landlords to respect these new laws in order to keep their reputations from being tarnished. In terms of this, many landlords will simply put up the money to abide by the regulations in order to keep their reputation intact and avoid any negative publicity.

The new regulations primarily benefit new buildings. As these regulations can benefit current buildings, the upfront cost involved has the potential to cripple current landlords forcing them to increase rent on current tenants and neglecting other maintenance issues within the building.

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