Would you renegotiate after a survey casts doubt on EPC rating?

[Greenestofbeans]

We’ve had an offer accepted at £425k on a 4-bed semi. When it was first listed a while back it had an EPC of C, then it came off the market and the sellers did some work (roof insulation, installing a wood burner, house already had solar panels) and it was relisted with an EPC of A (94).

However, our surveyor has basically said the A rating is overly optimistic. The walls in reality aren’t what the EPC assumes (part timber frame, not fully cavity), and the loft insulation is patchier than stated in the EPC certificate. The survey said the actual performance is likely lower and energy bills will probably be higher than expected.

There aren't any structural issues, however it's likely the house isn't as energy efficient as it was marketed as being.

Would it be reasonable to renegotiate the price? Or is it not really worth it?

Yes I potentially would offer £70k under. If the house was only of interest to me in an extended state, then I would work out the total I wanted to pay including the £70k extension, and base my offer on that.

They may or may not accept the offfer, but that’s how it works in the UK. Offer what it’s worth to you.

I think the reply to this comment is the odd comment. You don’t get a discount for cosmetic things you’d prefer a different way. If a house”needs” a new kitchen because the existing one is falling apart, that’s not cosmetic. Removing a wood burner because you don’t like them, is cosmetic.

I bought a house a few months ago in which I planned to convert the loft because I need a bigger third bedroom. Didn’t occur to me to tell the vendors I needed £100k off the price because I need the house to have 3 double bedrooms and the cost of the loft conversion would be £100k! Given the wrangling we did over the single item flagged as red in the survey, I can imagine the response I’d have got if I’d tried this!

You clearly thought the house was worth the price you paid without a loft conversion then. Others might knock a few thousand off to cover the cost of getting minor cosmetic things done.

Each buyer offers whatever the house is worth to them, for whatever reasons they have. Each seller is free to accept or decline. Not hard to understand.

If the house is already priced £70K lower lower than other houses in the area which have been extended then no need to offer less. But if it’s not and it’s priced the same as a larger house then people around here would definitely make an offer based on what it would cost to extend (if that’s what they wanted to do). Ultimately, an extended house is worth more than a non-extended one. However I wouldn’t offer less because of a wood burner, that’s not serious.

It wouldn't be priced the same as extended houses though.

I'm in Scotland and houses are valued here prior to sale, you don't just ask for a random amount of money you which is maybe what happens in England? House reports are done prior to sale and houses are valued at that point.

Unless the house really isn't selling and stays on the market for long, people will offer the asking price, at least. If someone starts asking to reduce for miniscule things such as them not liking wood burner, they wouldn't be entertained at all.

Pricing of houses is not hard to understand, no. The proposition that any seller would give a discount for cosmetic “improvements” counter to common sense and market practice.

No pricing of housing is not hard to understand. Their value is whatever someone is willing to pay for it. If people will only offer a certain value for whatever reason, then that is what the house is worth.

@Elektra1 And I never said the seller would give a discount. I said the buyer is free to ask and the seller is free to decline or accept.

Mic drop! Thanks for explaining the basics of how to buy and sell a house.

So why are you saying seller wouldn’t give a discount for cosmetic items when:

1 - I never said they would
2 - You now admit the seller is free to make that choice?

This and you can also use this to resell it. Easy enough to put more loft insulation in.

You said words to the effect of “adjusting your offer to take account of what you want to do to the house to make it how you like it is perfectly normal”. I disagree that reducing an offer for cosmetic adjustments is “perfectly normal”. However, I’m less invested than you in arguing the toss over this trivial point, so have a nice day.

It's going to depend on the market, but my experience has been that people are pretty attached to the value the estate agent places on the property.

We had a survey that showed dry rot in the living room walls, requiring complete renovation of what looked like a newly decorated room. They wouldn't negotiate. Another survey showed the flat was crown property, a major issue, and again they wouldn't negotiate. Our current house, the mortgage valuation came in below what we needed and they did accept that. That was a buyers market though.

So it depends on whether you would have bought the house with a more accurate epc

Yes I did say that. I didn’t say the seller would then necessarily accept it.

Yes I’m in England and we don’t have an “official” evaluation. The asking price here is determined by what the owner wants to get for it plus what the state agents thoughts are. There is a house near me that has an asking price of £200K more than another house on the same street which has been extended. The first one is done up better (although their fashion choices are really really unusual so). They are basically asking for £200K more than a bigger house with a slightly dated decor but way more to most people’s liking in my opinion. all else is equal for these two houses. This is the most extreme case I have seen if I’m honest but it goes to show how you could end up with a much higher asking price for a house which has not been extended vs one that has been extended. often times you also see asking prices being determine by what an owner needs to achieve in the sale in order to get their next house.

Oh that explains so much!

I have never ever heard anyone in Scotland offering under because they didn't like something. Like I said, people can offer under when the house isn't selling and I've known of people buying for £5k under or of houses where the asking prices kept dropping overtime due to lack of interest.
Now I can see why people on here often speak about offering under if eg kitchen isn't done up because I'm always thinking but the house is already valued lower than its equivalent with a done up kitchen so it makes no sense.
Another good thing is that you don't get things popping up after the offer is already in since the surveys are done prior to putting the house on the market so people always read them before going to view/deciding if they're going to view. So if there are any issues, you already know about them in advance.

@Highlandtown we're in a buyer's market here in (most of) England. My neighbour has just accepted £150K under her asking price of £875K. Admittedly after near enough a year trying to sell. No complaints about the house, her buyer offered less because it's all they could get mortgage wise.

"When it was first listed a while back it had an EPC of C, then it came off the market and the sellers did some work (roof insulation, installing a wood burner, house already had solar panels) and it was relisted with an EPC of A (94)."

This sounds suspect to me. Installing a wood burner decreases an EPC rating because you're opening up a hole that lets in cold air.

Fair enough, roof insulation would improve it, but if the solar panels were already there and have since aged, that should also bring the rating down a little bit.

Are you aware that the majority of EPCs are commissioned by estate agents who are either trying to sell or rent out houses?

They have a vested interest in them looking good.

FWIW, we've lived in 4 houses over 50 years, and the KwH listed on the reports haven't even come within 50% of our actual usage. They're desperately inaccurate.

Current home:

EPC thinks:

13821 kWh per year for heating
2991 kWh per year for hot water

Actual use:

Yearly Electricity usage
4896 kWh

Yearly Gas usage
25236 kWh

Electricity bounces up with cooking and F/F plugged in, TVs, etc, obviously.

The EPC inspector doesn't know that the timer on the UFH is broken. They don't know that the roof plastic tube heating system thingy isn't working. They don't know that rats are eating the wall insulation. They have commented that there's a combi boiler on the EPC report but have failed to note that it has two bloody hot water tanks attached to it, the timer is broken, and those hot water tanks want to heat to 60 degrees or so all the time, even when you don't actually want to use any water, so the heating of water is completely out of our control.

Nothing is tested, you see.

They're complete and utter pie in the sky.

But, mostly, remember who has the relationships with the EPCs assessors: the people wanting to get a sale or rental through.

You can order your own, independent EPC when you move in, if you like. But, imo, given they can't actually test anything, it's a completely pointless exercise.

I think you are just looking to chip the price. If I was the seller I would tell you to do one.

I think the Scottish system makes so much more sense. There is a lot more transparency when you make an offer as there are no surprises arising from surveys and searches further down the line. I would much prefer it to what we have here in England!

A buyer that tries to negotiate over an EPC is a buyer that can't be trusted and is likely to try and gazunder you at the last minute. I'd be doing everything I could to find an alternative buyer if someone pulled that stunt on me.

Yes, it's honestly such a great system.
And in the past, you couldn't pull out just before the exchange but that isn't the case so much now, sadly.
Overall, the system is a lot more robust.

I wouldn't ask for a price adjustment just because the surveyor says it "might" not be A. Your surveyor (and any subsequent ones) need to be precise and state exactly why it is wrong. He won't btw.

What you can do if you really want to quibble price is say the roof insulation isn't at the recommended depth in all places and either ask owners to rectify it or reduce the price so you can. But that would only be a couple of a hundred pounds anyway. What else is there that's fixable?

The fuel prices used for calculating the financial figures listed on EPCs are actually updated every 6 months.