EPC rating - panic!!

[SunnyUpNorth]

We have just had an offer accepted today on a property. I am usually extremely thorough with things but have been doing alot of research on the property style itself and somehow missed that the EPC rating is F. This has only come to my attention as I forwarded the link to a family member who noticed it.

We are planning to use the property as a holiday let and for our own use initially, with a view to retiring there in the future.

Ive been reading up about EPC regulations etc and all the limitations of the current system today and now feel totally lost. When we found out we had been successful in our bid I actually felt really worried rather than excited.

I’ve read opinions where people think the incoming regulations of all properties having to be C rated can’t possibly be enforced due to the fact that approx 60% of current UK housing stock can never be rated above a D due to not having cavity walls/not having gas central heating/etc. That does make sense.

however I’ve also seen stuff about how mortgages might be denied unless properties are a certain rating, which also seems silly if the mortgage companies therefore had their business cut by the above 60%.

However I am slightly panicking. Some of the things we could do such as installing energy efficient lightbulbs etc. But the bottom line is are we going to be buying a house that we can’t rent out and that will massively fall in value as it may be un-mortgageable??

I agree that relying on the government to just forget about making certain houses invalid for things like letting if they have low EPCs is hopeful.

Ultimately the only way we are going to get to net zero is a twin approach of both reducing the amount of energy we use and making the source zero emissions. It's not possible to do it without both. Relying on the government to simply forget about it is ... ambitious.

I do think there needs to be more flexibility around things like listed buildings, but that will come in time.

If a house has a low EPC then to me you should be looking at what cost is needed to upgrade it to something sensible and factor that in.

Also bear in mind that with energy costs increasing (as they will do as we move to more expensive forms of electricity generation) properties with F or G certs are going to become a nightmare to heat. Holiday lets aren't know for having low heating usage.

Sheep's wool insulation is treated so it isn't edible for moths.
In a building of traditional construction there may be moisture present at times which comes and goes, if the insulation method allows this to happen it can occur without structural issues being caused (moisture management needs to be understood in the design of any intervention), in that scenario rock wool would not work as well because it loses its insulation qualities when damp whereas sheep's wool does not.

Listed buildings are already exempt.

Relying on the government to forget about it is realistic. If the standards are virtually impossible to achieve in anything except new builds, what else can they do? We already have a housing shortage, we can’t just condemn the majority of the stock.

We will try to make it more efficient where possible but we aren’t planning a full reno.

My point is more along the lines of that some houses will never be able to attain a C for various reasons and others can be warm and toasty but still only obtain lower scores. They don’t actually test the properties thermally when they rate them, they just make assumptions. You can equally get some houses that have a great rating but are freezing and hard to heat. So the rating itself doesn’t worry me as an end user it’s more the future investment impact.

I think I feel more comfortable with it all now though, thanks for everyone’s views. We will do what we can and hope that the exemptions will be in place in the future or that the way the system is run is overhauled.

I've recently had the EPC done on my 1930s semi. In the end it's little more than supposition and opinion. Mine came out an E and the best it could achieve is a C. They recommended cavity wall insulation despite my house being in a don't do it area - the map is on the Gov website. Marked down for no thermostatic valves on the radiators, the wrong sort of low energy bulbs, not measuring the loft insulation properly. To make a C would involve fitting solar panels despite having no south facing roof and other changes that would cost around £15,000.
Just to make it even more daft my neighbour's house, a mid terrace can make a B, they haven't got cavity walls to fill so I guess being mid terrace counts as insulation. And their south facing roof is tiny with a dormer window in it.

While I think it is great to encourage using less energy making rules that are blind to the situation for millions of people just shows how insulted (sorry) from reality those making them really are.

EPCs are often rubbish. The person doing it can't see into the walls and often doesn't go into the loft or under the floors so can't be sure what insulation there is. I offered one of them access to the loft when we sold way back so he could see the insualtion, he said no point bothering to go up there as where we'd floored it he would have to assume there was no insulation anyway, so he'd have to put it down as none at all. It was fully insulated to the current standards, actually.
This house was an F when we bought it. We've done quite a bit already to insulate, and will do more, but I bet an inspector would still grade it as an F because they'd be too idle to go in the lofts or undr the floors, and couldn't prove we had done the dry-lining we have done without drilling holes in the walls.
Basically, most old houses will be cold. You just do what you can to help, and avoid cavity wall insulation (esp if you live in the N and W) and several other kinds of insulation as well unless you want a stinking damp house. A dry house feels warmer than a damp one, even if the damp one is actually at a higher temperature (believe me, we have been there and got that t-shirt).

Ive an old house with low epc rating (bought 2 years ago).
Sadly, theres a difference between making it energy efficient and getting a better epc....eliminating draughts makes far more difference to comfort and heat than replacing a B rated kitchen appliances with an A rated one, and saves way more co2.
Some bits (more recent extensions) can have cavity wall insulation, but not all of it.
Some fuels emit more co2 than others (in their production as well as in use - eg oil refineries emit loads of co2, electricity can be green to produce, but isnt necessarily).
EPC ratings ate quite a blunt instrument: hopefully they will be refined significantly before theyre used in legislation.

Can I ask what Listed buildings are exempt from? Is the 2025 requirement.? I'm also confused by someone saying they didn't need an EPC as they live in a 400 year old listed building. So do I, but it still had an EPC when we bought.

It was me. Your house may have one but it’s not a legal requirement.

Buildings that do not need an EPC These include:

• places of worship
• temporary buildings that will be used for less than 2 years
• stand-alone buildings with total useful floor space of less than 50 square metres
• industrial sites, workshops and non-residential agricultural buildings that do not use a lot of energy
• some buildings that are due to be demolished
• holiday accommodation that’s rented out for less than 4 months a year or is let under a licence to occupy
• listed buildings - you should get advice from your local authority conservation officer if the work would alter the building’s character
• residential buildings intended to be used less than 4 months a year

https://www.gov.uk/energy-performance-certificate-commercial-property/exemptions#:~:text=You%20don't%20need%20an,for%202%20years%20or%20less

Thank you everyone for this extremely useful thread - reading in detail.

I have a small flat - top floor in converted Victorian townhouse. It has an E with potential for C, but this would require roof and wall insulation. I've tried looking into it, but I don't even get quotes back on checkatrade! I don't know if I'm putting in the wrong search terms, if it's an undesirable job, or if there just aren't enough of the right tradespeople (as a PP alluded to)? I'm in central London so you'd think there would be someone...

Like many PP, this flat is the warmest, coziest place I've ever lived in - even with the price rises this winter, I was spending less on heating than anywhere else I'd lived... it's crazy to me that it has such a low rating.

Posted too soon!

I bought this flat as a primary residence, but always kept rentability in mind - it's a 1br in London which has been amazing as a young couple, but now that we're thinking about DC, we want to live somewhere more appropriate and rent this place out. And so much could happen in the years to come, we might also need to sell at some point. So OP, I completely understand your anxiety around all the different possibilities with EPC, renters, mortgages, etc....

Bit of an update…mortgage broker came back today to say none of their top lenders would lend to us on a property with an F rating!

I also contacted the assessor, our conveyancer and the agent.

Broker and conveyancer both hinted that that they felt it would be risky for us to proceed as they think the regulations will tighten quite soon.

The assessor was predictably vague but did confirm that if the report has the potential rating as a D if all the recommended works were done then yes it is unlikely it could ever achieve a C.

The agent said they will try to get another EPC done (current one was done two years ago) but I’m not actually sure if any remedial works have been done that would lead to a better rating. I’ve asked. Realistically at best it would be rated an E.

Not sure how we feel now. I still think they can’t enforce a system that would make 60% of current UK housing stock unmortgagable or un-lettable, but it still feels risky.

Blimey. Standard or BTL mortgage?

Holiday let mortgage.

It's almost as if the mortgage companies have read the government guidance and know where this is going ...

🤔

It’s not going anywhere, it’s ludicrous to even imagine that the majority of the country’s housing stock will be made unmortgageable.

OP said 'top lenders.' That means others will still lend. They will probably charge more or chuck in some energy improvement restrictions.

That’s the way it will go. They will lend and thin x amount of time the improvements will need to be made.
There is no way the government will back down on increasing EPC ratings.
You can’t have people not allowed to buy a small petrol car but are allowed to live in an EPC F property and pollute from there.

For sure it will have to go that way eventually, but I don't believe we have the workforce or financial resources as a country to meet the current green home initiative deadlines that are currently proposed. For example, a ban on new oil tank installations (2028?). Air source heat pumps are a nice aspiration but you need tens of thousands on better insulation first, and there are very few trained installers in the country.

They are going to have to get real when it logistically cannot be done.

It’ll just keep getting kicked down the road. I can’t see it being enforced in my lifetime.

About 15% of our energy usage comes from domestic heating, so they don't have an option to do nothing.

They will plan the work and work the plan.

How they will implement stuff who knows. They may do it over a longer timescale, they may fiddle around with other things and maybe issue different exemptions. What I do know is living in poor EPC housing will become a lot more expensive - it has to in order to achieve net zero, and the cost of that is likely to fall on the homeowner. There is no option to do nothing.

The smart money is spotting stuff like this from a mile off and avoiding the problem altogether, or at least factoring it in to the purchase price.

I agree that "specialist" lenders might continue to lend, but the question is why would you want to go with that specialist lender. Isn't the fact that a property is unmortgageable with a mainstream lending ringing the alarm bell ?

With a third of homes owned outright the mortgageability of a lot of properties won’t be tested. The EPC rating wouldn’t be a deciding factor for a cash purchaser, particularly one who intends that it will be their final home.

If I had to guess I'd say that's the problem- letting. The rules on how a property must be in terms of insulation for letting are supposed to tighten up soon, and lenders may be getting touchy about it.
I can't see it happening- most of the housing stock round here that's let would never get to C- old stone terraces, etc. How would it be if the government imposed it and half the rental properties or more suddenly became unlettable? would exoisting tenants have to move out too? If this was imposed by lenders on all properties, a huge number of houses would be unlettable and only be saleable to those with cash- that's just not tenable. We'd have millions of empty houses and the same number of households living on the streets.

Hesat pumps are unsuitable for millions of homes, as they need a lot of insulation to be in place. Cavity wall insulation is impossible for many houses (they have no cavities) and very unwise for many more ( wrong part of UK, they'll just end up damp as well as cold- check the maps for this, it affects huge areas of the country). They don't work where it gets too cold, as they rely on at least some heat outside, that's even more swathes of the country. Also, if everyone had a heat pump, the Grid would collapse, it could not provide anything like remotely enough of the additional electricity required. Even if people put in solar panels, as in periods of cold dark days or at night, there still wouldn't be enough power, unless everyone had several massive batteries that were much better than even the best ones we have now.