Thursday 29 January 2009

Agents fear litigation as energy rating assessors 'unleashed'

Energy ratings: Estate agents have been warned by the IAVI not to recommend energy ratings assessors as confusion over BER certs continues, writes Edel Morgan

ESTATE AGENTS could be left open to litigation because Sustainable Energy Ireland (SEI) has “unleashed” untested BER assessors on the public, says the IAVI (Irish Auctioneers Valuers Institute). Second-hand homes cannot be legally sold or rented without Building Energy Rating (BER) certificates since January 1st of this year. (New homes have required BER certificates since 2007).

But although some 1,486 BER assessors have been registered by SEI – the body responsible for implementing the BER scheme along with two Government departments – a national test to establish the competence of assessors after they’ve completed and achieved a 70 per cent pass rate on their training course won’t be available until later this year.

IAVI chief executive Alan Cooke says SEI has allowed this happen because it wanted to “save face” and “because they don’t want to admit that there aren’t sufficient assessors examined to enable a smooth lead into the introduction of BER in Ireland. They are a year behind where they should be on it.”

Calling BER a “litigation minefield” Alan Cooke says the IAVI has advised its members against recommending assessors in the absence of a national test and instead refer clients to a list of assessors approved by SEI. He says already one of its members has been threatened with a lawsuit because it recommended an assessor that carried out an assessment on a listed building which did not require a BER certificate.

SEI, however, refutes there is a problem, saying BER assessors “meet the qualification requirements”, which includes achieving at least 70 per cent in the BER exam held by training providers. “As part of SEI’s commitment to continued professional development of assessors, a national test, which registered assessors have committed to passing before the end of 2009, will be introduced later in the year. This will have no impact on BER ratings that have been issued,” it says.

There seems to be a lack of knowledge about BER among the general public. When estate agent Christopher Bradley of Sherry FitzGerald recently handed out energy rating certificates at a viewing of a 100-year-old house on Avoca Avenue in Blackrock, Co Dublin, the bewildered response was “what’s that?” His experience is echoed by other estate agents around the country who say awareness of BER is minimal among the general public.

Ger Tierney, an agent with Chesser auctioneers in Limerick, says his firm was selling a new homes development in Castletroy before Christmas, where 70 houses sold and only “three or four people asked for the energy rating. People are not giving it a lot of thought.” There is also a lack of awareness of the legislation among vendors of second-hand homes. “We often have to break it to them that they need to have the property rated,” says Tierney.

When asked if it has done enough to promote awareness, SEI said it has run numerous awareness campaigns in the run up to the full implementation and says it has “a comprehensive and popular website and telephone advice service available for any particular queries”.

New-build homes being sold or let have required a BER certificate since 2007 while the requirement to have a certificate for second-hand homes only passed into law this January. The BER certificate is part of the Energy Performance of Buildings EU Directive which aims to reduce carbon emissions. It is also designed to give prospective tenants and purchasers an idea of a property’s energy performance and how much it costs to light and heat.

Michael Boyd of Boyd’s Real Estate Alliance in Kilkenny says while he is “all for energy efficiency” he says there is “no doubt BER has been poorly handled”. He believes SEI “didn’t get its act together quickly enough” and was too slow in issuing the appropriate software to allow newly qualified assessors issue rating certificates on second-hand homes.

He says some BER training courses are primarily interested in making money with little regard to the experience of the participants. “You get bored farmers and taxi drivers taking the course so it’s a race to the bottom in terms of standards. I don’t have confidence in the system that the SEI has set up to ensure impartiality and objectivity and to assess to uniform standards. On one assessment of a property you might have an assessor with a building background and next door a farmer who has pitched and bargained to do a job and may be under pressure to produce a satisfactory result.”

SEI insists the quality of BER certificates is controlled by “periodic checks on the work of the BER assessors”. It says assessments and assessors will be selected for audit on a random basis. “Evidence of unsatisfactory technical quality or breach of the code of practice is liable to lead to disciplinary action up to and including termination of registration.”

Boyd says he has noticed “big resistance” among vendors when they’re told they have to provide an energy rating certificate for their property. “They may be selling because things are tight and might want to avoid paying that €300-€400 bill altogether. People don’t want to hear about extra expense and there have been inferences from some vendors that they will go to the estate agent who will pay to have the assessment done for them.”

Estate agents are allowed to become BER assessors but can’t rate properties on their own books and are prevented from selling or letting a property they assess for 10 years. Under the code of practice anyone that might have a vested interest in a property can’t perform an energy assessment on it. This is a bone of contention with the IAVI who say that their members in Northern Ireland are allowed assess properties for their own clients and it’s not deemed a conflict of interest.

“If the system is transparent and checkable there shouldn’t be a problem. Are they saying agents would issue false certificates and risk their income? Are we professionals or not?” says Alan Cooke.

Jeff Colley, editor of Construct Ireland, says the Government should insist that estate agents publish energy ratings on promotional material to prevent them “from brushing bad ratings under the carpet”.

At present there are 1,486 registered BER assessors, and over 1,000 of those are qualified to assess second-hand homes. Jeff Colley reckons SEI hasn’t been adequately resourced to manage the smooth introduction of BER, “to ensure the quality of assessors and avoid a divergence of quality in assessments”. And they need to tighten up on “who becomes a BER assessor and why. It’s quite a technical area.”

He says with new buildings it tends to be more straightforward, a desktop exercise based on calculations but there are more anomalies when it comes to older buildings “and more scope for error”.

All of the agents interviewed say they are inundated daily with calls and flyers from newly trained assessors looking for referrals. The competition has become stiff and this has led to price fluctuations. Initially, average prices of around €300 plus VAT for a three-bed semi were being quoted but these are likely to plummet as new assessors undercut each other to get work.

Several of the estate agents interviewed felt that, when BER awareness grows among buyers, a property’s energy rating will be used as a bargaining chip to negotiate more money off the asking price of a property.

In the rental market, a look at discussion boards – like and – reveals that some landlords have no qualms about going for the cheapest assessment regardless of quality to fulfil their legal obligation.

Others are saying they will try to avoid having the assessment done for as long as possible.

The Law Society has told solicitors that failure to comply with the BER can incur a €5,000 fine. The feeling is that enforcement, which is the responsibility of the local authorities, is likely to be an issue, particularly in the rental sector.

“The local authorities are meant to be enforcing BER but the question is, has the Government given them additional resources?” says Alan Cooke.

When tenants start to get savvy about BER, however, a bad rating may have an impact on the rent achieved, particularly if there’s a newer property down the road with a better rating.

It being very much a tenants’ market, landlords won’t be able to pass the charge on to their tenants and, according to John Leahy, the owner of Irish, some are complaining it is just another cost they have to contend with.

He says there’s still quite a lot of confusion surrounding BER, although he has noticed the level of interest in it has improved since January 1st.

“Like everything, people ignore it till it’s upon them. It’s been a very slow build and some property owners feel it’s just an additional cost in a tough economic environment. They are looking at what is beneficial in the short term.”

Irish Times

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