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Selling an apartment and energy labels

Ms Michaela recently submitted the purchase contract for her new apartment for our review. However, it was missing the so-called energy label of the building. How big a problem is this? Who is obliged to provide the energy label?

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What is an energy label?

The energy performance certificate of a building (called an energy label) reflects the amount of energy used in normal operation (heating, insulation, etc.). The information in the energy label helps you estimate the annual energy costs needed to run the building. The label classifies buildings into energy performance classes: from A (the most energy-efficient) to G (the most energy-intensive and therefore the most expensive to run).In 2020, the rules for energy labels have become stricter. This change is in line with the European Union’s objectives to reduce energy consumption and increase the use of renewable energy sources.

Who is obliged to provide energy labels?

It is the property owners who should provide their houses with an energy label if they want to dispose of it in any way (sell, renovate or rent).

This is not a problem for new builds, where the low energy performance guarantee has a positive impact, particularly for well designed and insulated properties, as they usually receive an excellent rating. It is worse for older buildings where it is more of an inconvenient administrative cost, plus they receive a poor grade which can reduce the value of the property.

However, there are many exceptions to this obligation. Therefore, an energy performance certificate is not required if:

– a building built before 1947 that has not undergone any major renovation (e.g. insulation, new facade) since the time of approval.

– a building with a total energy reference area of less than 50 m² (this refers to the dimensions of each floor up to the outer edges of the external walls),

– a building for family recreation (e.g. cottages if used only part of the year – the law speaks of a quarter of the energy consumption compared to houses used all year round),

– a listed building,

– an industrial or agricultural building with an annual consumption of up to 700 GJ,

– a building used for worship and religious purposes.

Real Estate Purchase or Sale

We provide a complete package of legal services related to real estate sales and purchases, including reservation contracts and escrow services. We will also help you with all tax and land registry issues. Our work is fast and accurate, ensuring a worry-free transaction. You’re also welcome to pay after services are provided.

Where can I get a label ?

Regardless of whether you are building a new house or renovating an existing one, the process of obtaining a Performance Energy Performance Certificate (PENB) is the same. This certificate can only be issued by certified energy professionals who are accredited and trained. These specialists are authorised to issue the certificate by the Ministry of Industry and Trade.

If you are interested in having an energy label made for your property, you should seek out energy specialists in your area. A list of these specialists is available for consultation.

To assess the energy performance of a building, an energy specialist needs comprehensive information about the property. A number of documents are required to prepare a PENB, such as:

  • Project documentation.
  • Information on the use of the building.
  • A report on the condition and level of the building’s technical equipment.
  • Floor plans of the individual floors with room designations.
  • Information on the orientation of the building in relation to the cardinal points.
  • Building section and other relevant data.

What are the obligations of the unit owners’ association?

In the case of buildings, the owner must provide the label; in the case of apartment buildings, the unit owners’ association has this obligation.

What obligations does the seller have when transferring the property?

Taken in order, there are three successive obligations.

  • First, the owner who wants to sell the property has the obligation to provide the label. If he or she owns the whole house, he or she will have a specialist company prepare it. However, if he owns only the flat, he follows a different procedure. The owner of the flat must invite the unit owners’ association in writing to issue a certified copy of the label for the house. If he or she does not receive it even after a written request, he or she can replace the energy performance certificate with the energy supply bills for the last three years. Before obtaining the certificate, the owner of the flat must indicate the worst energy class G in any advertisements offering the flat for sale.
  • That brings us loosely to the second point. If the owner advertises the sale of his property, he is obliged to ensure that the energy rating is included in information and promotional leaflets. The statutory wording ‘in information and publicity material’ is quite broad, so we recommend that the performance rating is stated in any advertising.
  • Finally, at the third and final stage, the seller is obliged to present the energy performance certificate or a certified copy of it to the potential buyer before the purchase contract for the property is concluded. This is usually done at the actual signing of the contract, which is the last moment to present it. It does not have to be mentioned in the purchase contract itself, but it is better to state it explicitly so that there is no confusion later. The presentation of the label should therefore be conclusive.

What penalties can property owners face?

An individual can be fined up to CZK 100,000 as the owner of a building and up to CZK 50,000 as the owner of a unit (flat). Legal entities and natural persons can be fined up to CZK 200,000. It is therefore not advisable to underestimate this obligation.

In the case of Mrs Michaela, we ensured that the label was handed over when the contract was signed, so no problem could arise.

Download the free e-book 5 tips on how to buy or sell property risk-free and go through the process of selling or buying a house, flat and land smoothly.

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Author of the article

JUDr. Ondřej Preuss, Ph.D.

Ondřej is the attorney who came up with the idea of providing legal services online. He's been earning his living through legal services for more than 10 years. He especially likes to help clients who may have given up hope in solving their legal issues at work, for example with real estate transfers or copyright licenses.

  • Law, Ph.D, Pf UK in Prague
  • Law, L’université Nancy-II, Nancy
  • Law, Master’s degree (Mgr.), Pf UK in Prague
  • International Territorial Studies (Bc.), FSV UK in Prague

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