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Become an Eco-Friendly Landlord & Tenant
(And save money!) 

During the recession and with climate change an increasingly pressing issue, it is important to consider ways of saving money while making environmentally friendly choices. In this article we look at tax allowances, energy saving products and some simply tips on how to make property green and reduce bills for landlords and tenants.

Buildings are responsible for almost 50% of the UK’s energy consumption and carbon emissions. Homes account for some 27% of these emissions. Making current and future homes more efficient is therefore important not only for landlords and their tenants, but also for the environment if the UK is to meet its carbon reduction target of 80% by 2050.

Some impressive changes will be required if the Government is going to meet these targets, so we are likely to see increasing incentives and regulations over coming years – some of which we discuss in this article.

Landlord’s Energy Saving Allowance

Second only to the Rent-a-Room scheme, the Landlord’s Energy Saving Allowance (LESA) is one of the most generous tax breaks currently available to private sector landlords. Also, the scope for the scheme has been widened in successive budgets.

Whether you are an individual or corporate landlord letting residential property, if you are not claiming an allowance under Rent-A-Room scheme or are renting our property as furnished holiday accommodation, you can reduce the tax you pay by making energy saving improvements. The LESA allows a landlord to claim up to £1,500 against tax every year, which equates to a direct annual cash saving of £600 for higher-rate tax payers. It can be applied to any expenditure on each dwelling for the installation of:

• Cavity wall and loft insulation
• Solid wall insulation
• Draught proofing and hot water system insulation
• Floor insulation

Since 6 April 2007 it has been possible to claim maximum allowance of £1,500 for each rented house, flat or bed-sit. For example, if you rent out a building that contains four flats you can now claim up to £1,500 for each flat. You can claim LESA until 1^st April 2015, when availability of this allowance will end.

Not only does LESA allow you to save on the tax you pay, it also cuts fuel bills for tenants and reduces carbon dioxide emissions – the main greenhouse gas responsible for climate change.  

Draught proofing & insulation

Changes to Parts L and F of the Building Regulations have been planned to come into force in October 2010. Essentially, the main effects of these regulations will be to increase the thermal efficiency both for new buildings and existing buildings where major works and extensions take place.

When the proposed standards in Part L are strengthened, there is likely to be a tendency to move airtight buildings. Changes to Part F of the regulations have therefore also been incorporated to ensure adequate means of ventilation is provided.

It is a good idea to check any existing windows and use draught-proofing strips if you can feel cold air coming in, as this also means warm air is getting out. You could opt for renewable energy sources for your heating, the most common of which is solar, wind, water and biomass.

Energy Performance Certificates

Private residential landlords are legally required to provide an Energy Performance Certificate (EPC), which must be given to a prospective tenant at viewing, when any documentation is required and the contract is signed. This certificate will be valid for ten years. While there is no obligation to act on the recommendations in this report, the aim of it is to give tenants an idea of the potential costs involved in heating the property, as well as the knock-on environmental effects.

Sourcing Materials

Ways to save energy and money in your property can be introduced at any stage, from designing a new building or buying an old one, to the maintenance of an existing tenanted property. For example, when doing any building, renovation or repair work to your property, it is worth considering where the materials you use are sourced from. Using recycled fixtures are reclaimed wood can be good for both the environment and your wallet. Companies such as Reclaimed (www.reclaimed.uk.com), a wooden flooring and joinery timber manufacturers and suppliers, work only with reclaimed timber and are keen to promote environmental awareness in doing so. However, if you prefer to work with new supplies you might consider using sustainable harvested materials such as bamboo, which, because it is a grass, grows much faster than wood. When used in flooring it has the added benefit of being strong, durable and resistant to insects and moisture. If you do decide to use wood, then it is preferable to choose a tree that is native to Europe (such as pine, oak, beech and birch) and look out for the Forest Stewardship Council’s (FSC) “tick tree” logo. According to the FSC, when you see their logo you are buying wood “with the confidence that you are not contributing to the destruction of the world’s forests”.

Another environmentally friendly choice when selecting materials is low-VOC paint. VOCs (volatile organic compounds) are found in the majority of paints and not only contribute to climate change, but are also thought to be toxic to humans. Opting for low-VOC pain or, even better, natural VOC-free paint, is much safer and comparable in price to conventional paints.

Appliances and fixtures

If you are buying new appliances for your energy and money saving products on the market. There are two key energy labels to look for:

• The Energy Saving Recommended logo can only be used on the most energy efficient product, usually the top 20% of those available
• The EU energy label grades products from A(best) to G(worst)

It is also worth looking for a washing machine that uses less than 50 litres and a dishwasher that uses less than 15 litres of water per wash. If feasible, you could also save on the cost of a dryer altogether by providing an outdoor washing line for your tenants. You might also consider the size of the appliances; not only do smaller appliances save on energy, they also save on space. If it is necessary to dispose of an old appliance that cannot be re-homed, then local waste and recycling centers accept goods free of charge. Local authorities can also collect items from your home, although this may incur a fee. If the appliance is being replaced then the retailer of the new appliance is obliged to either take away the old item or advise on where it can be recycled. Currys (www.currys.co.uk) outline the benefits of recycling electrical goods:

“Recycling unwanted electrical products is better for the environment. Over 75% of waste electrical goods end up in landfill, where lead and other toxins contained in electrical goods can cause soil and water contamination”

When buying a new toilet, choose one that is water-saving or dual-flush. Fit older toilets with a variable flushing device, or install a water displacement device in the cistern to reduce the amount of water used for each flush. Equally, look out for leaks – a dripping tap alone can waste 15 litres of water a day.

Boiler Scrappage Scheme

You may also be aware of the Boiler Scrappage Scheme, a Government-run initiative open to 125,000 householders and landlords across England. If your boiler is G-rated, equivalent or worse, you can claim £400 toward the cost of upgrading to high efficiency A-rated one, or renewable heating technology.

Outside space

If your property has outdoor space there are a whole host of ways to be green. Water butts or rain barrels, for example, collect and store rain water, which can then be used for watering plants in dry weather. When choosing the plants themselves it is a good idea to pick ones that grow naturally in your area, as this is wildlife-friendly and will help attract native creatures. If there is space then creating a covered area for bikes will encourage tenants to cycle rather than drive. If you are still in the process of looking for a property to let then consider its locality in terms of shops and transport links, so people are more inclined to leave the car behind. Providing appropriate recycling facilities is also very important.

New tenants

Supply any new tenants with information that can help them to be environmentally friendly as well as keep their bills down. Information you might consider providing could include details of local recycling centers, a fact sheet on energy saving tips and maps of local cycle routes. The following is a list of just some of the things you could advise them to do:

• Use energy saving bulbs (if every UK home installed just three, enough energy would be saved to power all UK street lights)
• Wash clothes at 30 degrees and only use dishwashers and washing machines when you have a full load
• Dry clothes outside or on a clothes rack
• Turn appliances off or on a standby
• Turn down the thermostat and timer to avoid unnecessary heating use
• Do not wait for hosepipe ban, user a watering can and water from a rain barrel
• To keep the heat in, close your curtains once it is dark
• Only boil as much water as you need

Home energy monitors

Home energy monitors are small devices that show how much energy is being used in a property and, in some cases, how much money is being spent plus a estimate of the greenhouse gas emissions being generated. These vary in price, from anywhere upwards of £10. Our Homemove Box contains a free one. It is estimated by The Energy Saving Trust that by anything from 3 to 15%.

Home eco-audits

In 2005, award-winning environmentalist Donnachadh McCarthy set up 3 Acorns Eco-Audits (www.3acorns.co.uk). The company works with businesses, charities, schools and homes to help ‘improve their environmental performance’. Involving a two to three hour site visit, a home eco-audit costs £250 and will assess your property’s carbon footprint, as well as look at a variety of other factors. Including, water efficiency, waste reduction and electricity use.

Conclusions

While there are a wealth of measures landlords can take to become more eco-friendly, the rewards may take some time to reap and a certain commitment to both becoming green and saving money long-term is required. However, investment at this stage will no doubt pay off in the future and, with a few changes here and there, you can ensure you are offering both an environmentally and an economically efficient home to your tenants.

References

1. Letting Update Journal – Energy Efficiency, Oct 2008, p23, Jan 2009, p24, Oct 2010, p18,
2. How to make your home and workplace planet- friendly, ©2005, Donnachadh McCarthy
3. http://www.planetryvoices.org.uk/greening_a_lifestyle.html , Last accessed Oct 2010
4. http://chicago.timeout.com/articles/features/22034/green-house-effect#articleAfterMpu , Last accessed Oct 2010