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Daily Mail
a day ago
- Business
- Daily Mail
We're tempted to buy a flat above a Post Office but will it be a mortgage headache or hard to sell in the future?
My husband and I have found a flat we really like. It seems like reasonable value compared to other homes in the area. However, we have one major concern... the flat is located above a Post Office, which is possibly why it is a little more reasonable than other properties in the area. The flat itself is leasehold with 188 years on the lease and the service charge is £1,000 per year. But should we stay clear given that the property is above commercial space? We are worried that a Post Office could change to something else in the future, like a restaurant or takeaway which could be even more disruptive and present a fire risk? Will it also be possible to get a mortgage on it and could it be difficult to sell in the future? Ed Magnus of This is Money replies: When it comes to buying a home, often the biggest challenge is compromise - there is likely to always be something that holds buyers back. The human brain is hardwired to look out for threats and even those who find their perfect home, will likely spend a lot of time pondering over potential pitfalls. But it's great you have found a property that both you and your husband really like and feel is reasonable value for the area - that's the hard bit to get right. A 188 year lease is long enough not to worry and the service charge is relatively low, so that's also a positive, albeit you need to find out what the service charge is going towards, and whether it can be increased - and if that increase is capped. The average annual service charge for a flat in England and Wales was £2,300 in 2024, according to analysis by the estate agent Hamptons - so it's fair to say this is well below the norm. You are right to question about the flat being located above commercial space, given this has some potential to impact getting a mortgage and the ability to sell in the future. Given it is a Post Office, it would be worth checking it's opening hours and perhaps spending some time looking at how busy it is during the day - if that concerns you. In its present form, a Post Office below the flat should not cause an issue on the mortgage front, but as you say, there is the potential for it to change into something else in the future. For expert advice we spoke to Luke Thorne, associate director at mortgage broker SPF Private Clients, Amy Reynolds, head of sales at Richmond estate agency Antony Roberts. Will they be able to get a mortgage? Luke Thorne replies: While most lenders would generally consider lending to someone buying a flat above commercial premises, such as a Post Office, this is always subject to specific review from the bank surveyor. Some lenders will restrict the loan to value available where a flat is located above commercial premises, so this may mean that a higher deposit is required by any potential buyer. The type of commercial is particularly important and anything that could be detrimental to the saleability, such as noise, smells and extended opening hours, which for example could be associated with a café, restaurant or fast food outlet, which are likely to be treated more cautiously by the lender. Having 188 years left on the lease is fine. Lease length becomes a greater concern once the lender can only see say 85 years left at the time of stating the mortgage. Once that figure is hit, that's when lenders' appetite falls away and fewer options are available. While we are unaware of the property value and the conditions within the lease, £1,000 would not seem to be too onerous a service charge. However, this will be commented upon again by the valuer and the lender will incorporate any comments made that could affect the future marketability of the property, into its lending decision. What the borrower should also ask is if there is any ground rent applicable to this property. If there is, detail about value and review period should be ascertained as again this may impact the lending options open to the purchaser. Will they be able to sell in the future? Amy Reynolds replies: You're absolutely right to ask the question – flats above commercial premises do tend to be priced more competitively, and buyers often wonder why. The answer is that they can be harder to get a mortgage on and that affects the audience we can sell to. However, Post Offices are generally viewed more favourably by mortgage lenders compared to, say, a takeaway or pub - they're considered low-impact in terms of noise, smells, and foot traffic. The concerns about what the unit below might become in future are valid. There are rules around change of use, but these rules do change over time. We sell plenty of properties over commercial and would sell plenty more if lenders would take a different view of the risk. Provided it's a well-run building, priced sensibly, and in a good area, there will always be a market for it. It's just about going in with your eyes open, which you clearly are. Could a Post Office branch be changed to a restaurant or takeaway? Ed Magnus of This is Money replies: You'd hope that the Post Office branch below this flat will continue for a long time to come. The Post Office has sayid it is committed to maintaining its current level of Post office branches. That said, nothing is ever certain - and in November last year, The Post Office confirmed it will be axing 115 branches from its 11,500-strong network. Any future change of use will likely require planning permission from the local authority for someone to change the use from Post Office to a restaurant or takeaway. A Post Office is categorised as a Class A1 type of commercial property. Restaurants and cafes are an A3, while hot food takeaways are an A5 category. However, thanks to a recent government rule change to the commercial categories, switching from an A1 class to an A3 class could in some cases now be deemed a permitted development right, which might make it easier for that particular change to happen. How to find a new mortgage Borrowers who need a mortgage because their current fixed rate deal is ending, or they are buying a home, should explore their options as soon as possible. Buy-to-let landlords should also act as soon as they can. Quick mortgage finder links with This is Money's partner L&C > Mortgage rates calculator > Find the right mortgage for you What if I need to remortgage? Borrowers should compare rates, speak to a mortgage broker and be prepared to act. Homeowners can lock in to a new deal six to nine months in advance, often with no obligation to take it. Most mortgage deals allow fees to be added to the loan and only be charged when it is taken out. This means borrowers can secure a rate without paying expensive arrangement fees. Keep in mind that by doing this and not clearing the fee on completion, interest will be paid on the fee amount over the entire term of the loan, so this may not be the best option for everyone. What if I am buying a home? Those with home purchases agreed should also aim to secure rates as soon as possible, so they know exactly what their monthly payments will be. Buyers should avoid overstretching and be aware that house prices may fall, as higher mortgage rates limit people's borrowing ability and buying power. What about buy-to-let landlords Buy-to-let landlords with interest-only mortgages will see a greater jump in monthly costs than homeowners on residential mortgages. This makes remortgaging in plenty of time essential and our partner L&C can help with buy-to-let mortgages too. How to compare mortgage costs The best way to compare mortgage costs and find the right deal for you is to speak to a broker. This is Money has a long-standing partnership with fee-free broker L&C, to provide you with fee-free expert mortgage advice. Interested in seeing today's best mortgage rates? Use This is Money and L&Cs best mortgage rates calculator to show deals matching your home value, mortgage size, term and fixed rate needs. If you're ready to find your next mortgage, why not use L&C's online Mortgage Finder. It will search 1,000's of deals from more than 90 different lenders to discover the best deal for you. > Find your best mortgage deal with This is Money and L&C Be aware that rates can change quickly, however, and so if you need a mortgage or want to compare rates, speak to L&C as soon as possible, so they can help you find the right mortgage for you.
Daily Mail
2 days ago
- General
- Daily Mail
I'm worried my neighbours' leaning 6ft garden wall will fall and hurt someone: What can I do?
I live in a village in the East of England where lots of the properties are very old. The problem is that some of the garden walls of these homes are staring to lean towards the pavement. The walls are typically 6ft high, and at least double that in length. I worry that they could collapse and someone could get hurt if they are not sorted. They also block my way when walking, as I usually have a buggy with me. I think the walls should be replaced. Can I alert the council – and does it have the authority to make the homeowners take action? Ed Magnus, of This is Money, replies: We've heard from readers complaining about their neighbours garden fence collapsing in the past, but your predicament notches things up on the danger scale. You would hope any responsible homeowner or land owner might also be keen to avoid their wall collapsing and potentially seriously hurting someone. That said, they may be trying to pretend the problem doesn't exist or isn't their responsibility. After all replacing a section of a brick or stone boundary wall won't be cheap. But the owner may also not be aware, particularly if the property is rented out or they live elsewhere, so it could be worth being a responsible citizen and telling them about the danger. They may also consider the wall to be perfectly safe, even it it is leaning. If that doesn't work, alerting the council is the next best option. For expert advice we spoke to Kathryn Cooling, an associate in the property disputes team at law firm RWK Goodman and Olivia Egdell-Page, partner and head of property department at Joseph A Jones & Co LLP. What can be done about a dangerous wall? Kathryn Cooling replies: You are right to be concerned. Leaning garden walls, especially ones of that size, could pose a real risk if they were to collapse. You can certainly alert the local council and in many cases, they do have the power to step in. The key thing here is public safety when using footpaths. If a structure like a garden wall is next to a public footpath and it appears unsafe, the local council has a duty to investigate. However, they depend on the public to report these things. Most councils will have a team who deal with these kinds of problems and have sections on their websites where you can report dangerous structures or highway obstructions issues. If the council agrees the walls pose a risk to public safety, then they can usually serve a notice on the homeowners that they must make the walls safe. In some cases, the council may even step in and do the work itself. It would be worth taking some photographs to show how much the walls are leaning and where they are. This can help you making the report. At the end of the day, public footpaths should be free from obstructions. You can definitely report this to your local council. Olivia Egdell-Page adds: In most cases, the council cannot force homeowners to maintain a property boundary. The council's role is generally limited to addressing hazards and nuisances related to boundary structures, not enforcing routine maintenance. The responsibility for maintaining boundary structures will be dealt with in the title documents for the property, and typically will be the responsibility of the homeowners. If a boundary structure falls into disrepair and causes damage or injury due to neglect, the owner could be held liable. Property owners are primarily responsible for maintaining the boundary itself, whilst the council or highways authority in the area will be responsible for maintaining the surface of the public footpaths and highways. You may still wish to contact the council to see if there is anything they can do, as you may find the boundary walls in question are on council land, or that they are already aware of their deterioration. It just may be that if the council states that it cannot take action, you may be limited in the further action you are able to take. What if the danger was a leaning tree? Olivia Egdell-Page replies: Where a property boundary is formed by a hedge or trees, the highways authority can ask you to cut these back if they are causing an obstruction in the road or a public footpath. If the homeowners refuse, the highways authority can access the properties without obtaining permission to undertake the work and they may also charge the homeowners for this. That being said, the Court of Appeal ruled in the case of Sumner v Colborne that a highways authority owed no duty of care to users of a highway in respect of overgrown vegetation on land adjacent to the highway, which affected visibility at a junction. The case was brought following an accident at the junction, and it was claimed that the highway authority had breached their statutory duty and were liable for negligence. Whilst it was held the highways authority held a duty of care to users of the highway in respect of dangers that exist on the highway, no such duty was owed in respect of the dangers on land next to the highway. The court further confirmed that individual landowners of properties which abut (touch or lean on) the highway do not owe a duty of care to the road users in respect of the maintenance and upkeep of their land. How to find a new mortgage Borrowers who need a mortgage because their current fixed rate deal is ending, or they are buying a home, should explore their options as soon as possible. Buy-to-let landlords should also act as soon as they can. Quick mortgage finder links with This is Money's partner L&C > Mortgage rates calculator > Find the right mortgage for you What if I need to remortgage? Borrowers should compare rates, speak to a mortgage broker and be prepared to act. Homeowners can lock in to a new deal six to nine months in advance, often with no obligation to take it. Most mortgage deals allow fees to be added to the loan and only be charged when it is taken out. This means borrowers can secure a rate without paying expensive arrangement fees. Keep in mind that by doing this and not clearing the fee on completion, interest will be paid on the fee amount over the entire term of the loan, so this may not be the best option for everyone. What if I am buying a home? Those with home purchases agreed should also aim to secure rates as soon as possible, so they know exactly what their monthly payments will be. Buyers should avoid overstretching and be aware that house prices may fall, as higher mortgage rates limit people's borrowing ability and buying power. What about buy-to-let landlords Buy-to-let landlords with interest-only mortgages will see a greater jump in monthly costs than homeowners on residential mortgages. This makes remortgaging in plenty of time essential and our partner L&C can help with buy-to-let mortgages too. How to compare mortgage costs The best way to compare mortgage costs and find the right deal for you is to speak to a broker. This is Money has a long-standing partnership with fee-free broker L&C, to provide you with fee-free expert mortgage advice. Interested in seeing today's best mortgage rates? Use This is Money and L&Cs best mortgage rates calculator to show deals matching your home value, mortgage size, term and fixed rate needs. If you're ready to find your next mortgage, why not use L&C's online Mortgage Finder. It will search 1,000's of deals from more than 90 different lenders to discover the best deal for you. > Find your best mortgage deal with This is Money and L&C Be aware that rates can change quickly, however, and so if you need a mortgage or want to compare rates, speak to L&C as soon as possible, so they can help you find the right mortgage for you.
Daily Mail
3 days ago
- Business
- Daily Mail
Lloyds Bank wouldn't let me withdraw £600 in branch and insisted I use a cash machine outside
I went to my local branch of Lloyds Bank in Caerphilly to withdraw £600 in cash at the counter only to be told that due to new rules I had to go to the outside cash machine. If I wanted to be served at the counter I would have to request withdrawal of £800 minimum. The member of branch staff said all customers had been notified of this new procedure in March 2025. Looking at the current Lloyds website it states there is no limit for withdrawals over the counter just give advance notice if the request is for over a certain amount. Checking on my correspondence from Lloyds Bank I can find no notification of this change of policy. I wanted to withdraw it from the counter, as I felt vulnerable getting out such a large sum of cash outside - and I didn't think I'd be able to withdraw such a large sum from an ATM anyway. Helen Kirrane of This is Money replies: Lloyds is one of the few banks which does not have a maximum limit on how much cash customers can withdraw from the counter, according to advice it gave This is Money earlier in the year. Customers need to be able to provide identification if they are withdrawing lager sums. It sounds like you were given the wrong information by the member of branch staff at the counter. Lloyds has not changed the amount that can be withdrawn at the counter - or set a new minimum. What it has changed is the amount customers can withdraw from the ATM if using a Lloyds debit card. Customers can now withdraw amounts up to £800 in cash at the ATM and this has steadily been increasing. Previously, the amount which could be taken out at the ATM was £500. But you should still have been allowed to withdraw an amount of less than £800 at the counter without being made to go outside to use the ATM, which you said you did not feel comfortable doing for such a sum of cash. I don't blame you. Lloyds' branch staff will let customers know the options available to them for carrying out banking with it, but I am surprised a staff member thought the best way for you to withdraw £600 was to go outside and do it at the ATM. A Lloyds bank spokesman said: The amount you can withdraw at a cash machine is £800 per day if you hold a Lloyds Bank debit card. Helen Kirrane adds: Lloyds said you should have been able to withdraw the money over the counter. Earlier this year we asked the big high street banks how much customers can withdraw in cash at the counter. HSBC does not have a maximum limit for how much cash a customer can withdraw from the counter, providing it has the amount you require in cash at your branch. For cash withdrawals up to £5,000 you will not need to give any advance notice to Santander to get your money. Customers can withdraw amounts up to £5,000 over the counter during its opening hours on Monday to Friday – though not on Saturdays. There's no limit to how much money you can take out over the counter in a Barclays branch – as long as you've got the money in your account. Withdrawals up to £2,000 can be made at a Nationwide branch counter without giving prior notice to the building society.
Daily Mail
4 days ago
- Automotive
- Daily Mail
EXCLUSIVE Electric cars that crash in value in a year: Some are worth just a THIRD of their new price after 12 months
Some electric cars are worth as little as a third of their initial price - the equivalent of shedding £26,000 - after just 12 months, with This is Money revealing the 20 models with the most appalling residual values. EVs in general have suffered catastrophic depreciation since the end of 2022 when a cocktail of issues sent used prices into a downward spiral. This perfect storm hit almost simultaneously, involving a cost-of-living crisis, rocketing energy prices, hard-hitting media coverage of EVs, an oversupply of vehicles entering the second-hand market, and Tesla slashing new model prices. It quickly brewed into a destructive tornado for used electric car values. Three years later, this punishing depreciation is still hitting EV values - and to the tune of tens of thousands of pounds for owners who bought them outright, according to data shared with This is Money and MailOnline. Cap hpi - experts in the field of vehicle pricing - provided us with market information showing troubling EV residual values compared to cars of other fuel types, while also revealing the models that hemorrhage the most money after only 12 months. To understand what's stalling a recovery for second-hand EV prices, we also spoke to industry insiders to get their perspective on the crippling impact for the motor sector. How much faster are EVs depreciating? To understand just how rapidly EVs are leaking value, cap hpi provided data across all fuel types comparing their average new price and what a year-old model with 10,000 miles on the clock is worth. The average EV loses 43.2 per cent of its initial price over this 12-month period. In monetary terms, it means the resale value of a year-old EV is typically £25,900 less than the recommended retail price the owner paid. How does that compare to other fuel types? Hybrids are holding their value best, losing only 30.4 per cent (around £12,500) of their RRP in the first year. New diesels - which are incredibly rare now that car makers have slashed their availability on emissions grounds - are also holding value far more strongly than EVs, shedding 31.1 per cent (or just under £17,500) of their original cost. Buyers of petrol cars can expect to see 31.5 per cent of the retail price wiped from their motor's value after the first 12 months, which is the equivalent of £18,000. And it's plug-in hybrids that are depreciating at a rate closest to EVs, ditching 36.3 per cent of their value, which is a typical loss against the RRP of nearly £29,000 after one year. Which EV models shed most value in 12 months? Below is the countdown of the 20 electric cars that lose the most value in the first year, with a detailed look at the top 10 biggest fallers. When we asked cap hpi what makes these particular models shed value quicker than others, it said one of the biggest factors is that they were available in 'high volumes' during the period when EV values initially started barrel-rolling - around late 2022 and early 2023. Another contributor to their poor residual value is that many were launched with both a small and larger battery option, with the former much cheaper but far less appealing to used buyers. 'The smaller battery option looks inferior to rivals in term of range and charging capability, and these were often superseded by slightly larger, more efficient batteries,' Dylan Setterfield, head of forecast strategy at cap hpi, tells us. This combination of factors is why the 20 EVs listed below shed between 53 per cent and almost 67 per cent of their value in 12 months. FASTEST DEPREICATING YEAR-OLD ELECTRIC CARS (Number 20 to 11) Model Price new Value after a year Value lost Depreciation (%) 20. Peugeot e-Traveller (2020-) £53,876 £25,112 -£28,764 -53.4% 19. MG ZS EV (2019-2024) £32,941 £15,287 -£17,654 -53.6% 18. Fiat e500C (2020-) £35,140 £16,233 -£18,907 -53.8% 17. Citroen e-C4 X (2022-) £33,721 £15,306 -£18,415 -54.1% 16. Subaru Solterra (2022-) £53,940 £24,775 -£29,165 -54.1% 15. Honda e:Ny1 (2023-) £46,040 £20,100 -£25,940 -56.3% 14. Vauxhall Combo e-Life (2021-) £34,022 £14,800 -£19,222 -56.5% 13. Honda e (2020-2023) £37,340 £16,150 -£21,190 -56.7% 12. Fiat 500e (2020-) £31,107 £13,175 -£17,932 -57.7% 11. Citroen e-C4 (2020-) £32,890 £13,661 -£19,229 -57.8% Source: cap hpi 10. Peugeot e-2008 (2020-) - depreciates 58.3% Peugeot's e-2008 is a sound compact EV offering up to 250 miles of range on a single charge. But depreciation in the first year is rapid, at a staggering 58.3% Peugeot's small crossover model takes a huge financial hit in the first 12 months, losing 58.3 per cent of its value, which is the equivalent to £22,380. That's a big loss on a model that customers on average pay over £38,000 for. It was originally launched in 2020 with a 50kWh battery offering a range of 192 miles. An update since has upped this smaller battery range to 201 miles, while a 54kWh battery option provides up to 250 miles between charges. 9. Peugeot e-208 (2019-) - depreciates 59.4% Peugeot's smaller EV option, the e-208, fares even worse than the e-2008. Owners of new models see 59.4% of its value slip away over the first year The Peugeot e-2008's smaller sibling fares even worse than the crossover, with the e-208 French supermini shedding 59.4 per cent of its RRP after a year on the road with average mileage. With an average residual loss of £20,000, the depreciation in the first 12 months is more than the price of a new petrol engined 208 (£19,995). When it debuted in 2019, its lone 50kWh battery option provided up to 211 miles of range. This has been increased and a bigger 54kWh pack available now extends the distance between charges to 268 miles. 8. MG 5 EV (2020-) - depreciates 59.7% The MG5 EV is one of the cheapest new electric family cars - and one of few affordable estate EVs. Yet it loses 59.7% of its new price within 12 months on the road In terms of practical electric family cars, there are few models as capable - and affordable - as the MG 5 EV. Sold exclusively as an estate, it has bounds of passenger and luggage space. But that doesn't prevent a first-year collapse in value, with customers typically paying £32,191 for a new one, which is then worth just £12,975 12 months later. That's over £19,000 lost, which is effectively giving away more than £1,500 a month on what is already a budget-end electric family car. When it launched it came with a 52kWh battery supplying a range of 214 miles. A major facelift and overhaul in 2023 means customers can get their hands on one with almost 300 miles of range. 7. Vauxhall Corsa-e (2020-) - depreciates 61.6% Vauxhall will be hoping the recent arrival of a facelifted version of its Corsa and Corsa Electric will help spare the EV variant's poor residual values Given the Peugeot e-208's appearance already in this list, it's somewhat unsurprising to find its sister model from Vauxhall also making the order, though with a more significant one-year value decline of 61.6 per cent. Vauxhall will hope its recent facelift - and a Long Range spec offering 266 miles of range between changes - will give it a boost, but for now cap hpi shows it shifting £20,500 of its original £33,330 average new price after 12 months. That means owners who buy a Corsa-e outright can expect it to be worth just £12,700 when it turns a year old. In comparison, a year-old petrol Corsa, which was cheaper to buy new by depreciates far slower, is on average £3,600 more expensive. 6. Vauxhall Vivaro e-Life (2020-) - depreciates 61.7% The Vivaro e-Life is Vauxhall's large MPV that seats up to nine people. It's not cheap to buy new, costing on average just under £50k. After a year, these are typically worth just £19k The Vivaro e-Life is Vauxhall's answer to a large MPV with coach-like passenger capacity of up to nine seats. With a claimed range of just 141 miles, it's relatively limited in terms of driving distances on a single charge. This might be one of the factors impacting its poor residual value performance. It loses 61.7 per cent of the new price in 12 months, leaving owners of a near-£50k battery-powered MPV with an asset worth only £19,000 after one year. 5. Vauxhall Mokka-e (2020-) - depreciates 62.4% The third Vauxhall in this list - and one of six Stellantis models in the top ten - is the Mokka-e, which sheds 62.4% of its new value after one year Completing a hat-trick of electric Vauxhall's in this list is the Mokka-e - the compact crossover version of the Corsa, and the sister car to the Peugeot e-2008 (in tenth in this list). Offering up to 252 miles of range today, it originally launched in 2020 with a smaller battery providing as little as 197 miles between charges. With customers typically paying £37,000 for a new example, after 12 months it will have lost over £23,000 in value - that's depreciation of 62.4 per cent. This makes a year-old Mokka-e £4,500 cheaper than a Mokka petrol after the same amount of time and mileage. 4. Nissan Leaf (2017-2024) - depreciates 64.8% A new third-generation Nissan Leaf arrives next year, replacing this rather dated model that launched in 2017. Value retention for new models has been poor, losing 64.8% of its new price within the first 12 months of being registered This month, This is Money had an exclusive first look at the new third-generation Nissan Leaf, which is due to be delivered to customers in spring 2026. To prepare for its arrival, production of the previous-gen car ceased last year, and it is this ageing EV that's covered here. When it debuted in 2017, it could go no further than 168 miles between charges. However, upgrades over the year - including the 2019 arrival of the Leaf+ - upped the range to 239 miles. Given it is incredibly long in the tooth by relative electric vehicle standards today, it's not at all surprising to see the outgoing Leaf ranked fourth in this list for rapid depreciation. Though 12-month value loss of 64.8 per cent is still incredibly concerning. 3. Ora 03 (2023-) - depreciates 65.4% Ora is a Chinese newcomer. The brand is part of the Great Wall Motor conglomerate, which is a powerhouse in the EV market in East Asia. The 03 is its debut model for the UK with a compact size, oddball looks and even stranger launch name of 'Funky Cat'. Its limited range of 193 miles and steep pricing [by Chinese brands' standards] has made it less appealing to used buyers. Losing almost two thirds of its new price, owners can expect to see £21,900 disappear from its value in the first 12 months. 2. Mazda MX-30 (2020-) - depreciates 65.6% The Mazda MX-30 is the Japanese brand's first EV attempt. While a stylish and practical motor, it has a limited battery range of just 124 miles. This is likely contributing to weak values The MX-30 is Mazda's attempt to wade into the compact electric SUV market with a stylish retro design and suicide doors. But there is one limiting factor of this family-friendly Japanese EV that's almost certainly restricted its appeal to driver - and that's its range. At an official 124 miles, it far shorter than rivals and could be one of the main reasons why second-hand prices have been slashed to make them more appealing. It means a new one, typically costing £33,260, sheds £21,800 of that value in the first year. That's depreciation of 65.6 per cent in 12 months. 1. DS3 E-Tense (2019-) - depreciates 66.7% The fastest- depreciating electric car over 12 months is the DS3 E-Tense. While this small crossover offers up to 248 miles of range, it also loses £26,000 in the first year on average Citroen's electric hatchback sold today has a range of up to 248 miles on a full charge - though when it launched in 2019 it could only go for 200 miles before a fresh dose of electricity. Despite its relatively practical performance for such a compact car, residual values are exceptionally weak. For a new model costing on average almost £39,000, owners after one year have an automotive asset valued at less than a new Dacia Sandero (Britain's cheapest car), having lost almost £25,900 over the course of 12 months. Depreciation of 66.7 per cent makes this the fastest price faller of all models. PETROL CAR COMPARISON Ford Puma (2019-) - depreciates 27.6% Value after year: £21,167 Depreciation: -£7,985 For comparison purposes, we asked cap hpi to run the value retention figures on a Ford Puma petrol - Britain's best-selling new car for the last two consecutive years. While the EVs listed above all lose between 53.4 and 66.7 per cent of their average original price after the first 12 months, the Puma sheds just 27.6 per cent of its RRP in the initial year of ownership. In monetary terms, that's a loss of just £7,985 - a fraction of the depreciation that hammers the value of the electric cars listed. Why are EVs ravaged by hefty depreciation? As EV values continue to drop like a stone in the first year, we've examined what's having such a significant detrimental impact on used prices. One of the biggest factors is the level of discounting of new electric cars. With manufacturers under intense pressure to meet the Government's Zero Emission Vehicle (ZEV) mandate - the annually-increasing EV sales targets set out for the next decade - they have been slashing the price of models to make them more attractive to buyers. The Society of Motor Manufacturers and Trader (SMMT) claims car makers swallowed £4billion in losses associated to discounted EV pricing last year - and are on course to lose billions again this year as ZEV targets increase for 2025. Cap's forecast expert Dylan Setterfield says 'nearly new' [up to 12 months old] second-hand prices are also being compounded by other deals offered with new EVs to increase their appeal. He told This is Money: 'When a substantial financial discount on the new car is combined with 0 per cent finance and other elements such as free wall box charging units, complimentary servicing costs, and a large amount of free electric charging through a partner supplier, a new EV often ends up being cheaper than a nearly new used car, with the inevitable effect on used values. 'Although there are some exceptions, these incentives are not typically applied to used cars. 'Even after these new car offers are removed, the used values are unlikely to recover from their reduced level as the market has already been set.' Former Top Gear host turned EV campaigner Quentin Willson has blamed catastrophic electric car depreciation on over supply into the second-hand market from ex-fleet models and 'drivers not understanding EV technology' Quentin Willson, the former Top Gear host turned EV campaigner for the FairCharge group, said discounted new electric car prices are just part of a wider issue. 'Over supply of EVs from fleets into the used market, and mainstream drivers not understanding technology, have also combined to cause heavier than expected depreciation,' he told us. James Buxton, chief exec at car360 - the UK's largest sole used EV dealer network in the UK selling around 5,000 electric models per year - also blamed significant depreciation on a 'market imbalance' being created by a flood of used EVs from lease operators. Earlier this year, the British Vehicle Rental and Leasing Association (BVRLA) warned that car finance and leasing companies are losing 'hundreds of millions' of pounds at the hands of the rapid depreciation of electric vehicles, the trade body has warned. In a letter penned to the Government's Transport Select Committee, it said the sector has been the driving force behind EV growth but is now being left to 'shoulder' massive losses resulting from plummeting residual values. Toby Poston, BVRLA's chief executive, told us: 'Month after month, used EV prices are continuing to fall. This is costing fleets and leasing companies millions upon millions of pounds, eroding confidence across the second-hand market, pushing up new electric vehicle prices and acting like a drag anchor on the whole zero emission vehicle transition. 'Things have become so volatile and costly that fleets are trying desperately to avoid putting their BEV stock into the used market – by leasing them again or extending existing leases. 'The number of used electric vehicles hitting the market is already outstripping demand, but we know that even that 'supply' figure is artificially low because companies are holding back from defleeting to avoid crystalising their depreciation losses.' Quentin Willson also believes misinformation surrounding battery life being a major contributor to second-hand EV demand shrinking and anchoring prices, with drivers believing degradation is far more severe than studies have shown. He pointed to research from Geotab published last year - based a review of 5,000 EVs - that suggested that a typical EV battery degrades by 1.8 per cent each year, and says this will slow as more advanced technology emerge. Experts believe misinformation about the lifecycle of EV batteries is a cause of substantial depreciation. A recent report suggested that batteries in current models degrade, on average, by around 1.8% annually James Buxton, boss at EV-only used car site car360, says Elon Musk's unpopularity impact on Tesla prices has also dragged the wider battery vehicle market down Another market impact is the slump in demand for Tesla cars as public opinion on CEO Elon Musk has taken a major detour. Buxton, who said cars360 sold a record 400 used EVs last month, told This is Money: 'Tesla's woes have dragged the rest of the market down because they're still the largest volume player in the used car space. But these lower priced Teslas are now getting stronger enquiries.' So, how do EV converts avoid such crippling deprecation. Steve Walker, head of digital content at Auto Express, tells us: 'We've seen EV technology evolve very quickly with longer ranges, shorter charge times and lower purchase prices for new cars all making used models bought years, or maybe only months, ago look less attractive. 'The trick from a consumer point of view is to seek out today's top EV models; cars using the latest technology with long-term desirability built in. 'Then use the dealers' burning need to sell and a bit of careful haggling to get yourself a great deal. 'That'll help mediate some of the huge depreciation, but future residual values will always depend to a great extent on where the car market rollercoaster goes next.'
Daily Mail
5 days ago
- Business
- Daily Mail
Can I offer my estate agent a £1,000 bonus if they sell our home for the best price?
We're about to list our home for sale and have agreed a flat fee with the estate agent firm upon completion. I'm aware our selling agent will get commission, but can we incentivise him to sell our home quicker and prioritise us by giving him a cash bonus? I thought I would offer £1,000 cash off the books to make our home his number one focus and get the price we want. But is this unethical, or even illegal? Ed Magnus of This is Money replies: This is an interesting idea, However, it needs to be kept above board, on the books and handled in the right way to be ethical. It's worth remembering that a good estate agent shouldn't necessarily need to be given additional financial incentives to sell. You would hope they would want to get you the best possible price regardless, as this often dictates their commission. If a quick sale is what you are after, it might be a better strategy to simply price your property competitively. Homes that receive an enquiry on the first day of marketing are 22 per cent more likely to successfully find a buyer than homes which take more than two weeks to receive their first enquiry, according to Rightmove. Listing your property at a realistic asking price is also likely to attract more buyers. That means more interest, more viewings, potentially more offers and even a bidding war. Buyers tend to become more engaged once they know other people are interested in a property and that 'fear of missing out' kicks in. Will the bonus strategy work? This will divide opinion and many will argue it won't. After all, a property is worth what a buyer is prepared to pay for it and ultimately, what price you accept is up to you. But there could also be an argument for offering an incentive to the estate agency on the basis it is paid to whichever negotiator ends up selling the property. You need to be clear about the terms. For example, you'll pay £1,000 if they sell for a certain price, or within a fixed time period. If the estate agent is just a one or two man band, then I would question whether an extra £1,000 will make much difference to them personally as the managers of the business. That said, most estate agent offices have a team of sales negotiators who get paid commission when they sell a property. Typically only the negotiator who sells a property earns the commission - the others get nothing. Negotiators' commission is often 10 per cent of the fee agreed, albeit it can be higher than this. This means for example if you agreed a flat fee of £6,000 with the estate agency, only £600 of that might go to the negotiator who sells your home. Do the maths: Most negotiators will receive a percentage of your estate agent fee if they sell the property, but this will only be a fraction of the sale price Most estate agents charge a percentage fee, rather than a flat fee, the average being about 1.5 per cent of the final selling price. This in theory incentivises each agent to get the best possible price. However, the negotiator who sells the property may not be that fussed to negotiate hard on your behalf given they only receive a fraction of that. For example, while the difference between you selling for £400,000 and £410,000 might be a big deal for you, for the negotiator it could make all but £15 difference to their commission, based on them taking 10 per cent of a 1.5 per cent fee. Setting a target price for all the negotiators to target with the offer of an extra £1,000 incentive for anyone who manages to secure that price (or more) could in theory pay off. After all, the worst kind of estate agent is the one that just waits for the incoming phone call via Rightmove or Zoopla. A much better sales negotiator will pick up the phone, know their list of buyers and be able to create a buzz around your property from day one. Some agents may even be able to find potential buyers looking in surrounding areas - if they have other offices nearby with a buyer database they can access. For expert advice, we spoke to Mike Hansom, consultant for property litigation at BLB Solicitors, Jeremy Leaf, north London estate agent and a former residential chairman of the Royal Institution of Chartered Surveyors, and Matt Thompson, head of sales at Chestertons. Is £1,000 cash off the books legal? Mike Hansom replies: I am not sure what an arrangement 'off the books' would entail, but the extra fee you pay would be income that the agent needs to declare to His Majesty's Revenue and Customs. I recommend you are vigilant in avoiding any transaction where you suspect the agent might not declare the income. It could mean you are implicated and even prosecuted for an offence relating to tax evasion or avoidance. Assuming the transaction is entirely legitimate for tax purposes, there could be a view that you are simply looking for a premium service, for which you are willing to pay a premium rate, and in principle that is not unlawful. I also anticipate it is common for some agents to offer different marketing packages for different prices. Jeremy Leaf replies: I am not sure it is a great idea for various reasons – first and foremost, there is the tax and transparency question. Should the payment, if made, be disclosed to the tax authorities by the giver or receiver? And what would the reaction be of other client vendors of that agency if they were to discover that sellers have been offering extra payments to promote their properties at the expense of others? My advice is not to make the proposal as almost certainly trouble will follow one way or another. The majority of negotiators are on individual commission anyway so will benefit if they arrange a sale. You must be careful of offering one negotiator an incentive and not another because if word gets out, you may find the other negotiators disengage from trying to sell your home. Is it unethical? Jeremy Leaf replies: Any conversation would need to be had with the head of office or manager, explaining the circumstances and perhaps coming to a structured arrangement to incentivise the sale at a particular price, rewarding the successful negotiator who goes the extra mile. In this way, transparency is maintained and everyone knows what is happening. It may also depend on how big the agency is. A corporate structure might not be sufficiently flexible to allow for your proposal. Matt Thompson adds: I understand you are in a rush to sell your property, however, offering your selling agent an additional amount of money 'off the books' is not something that an agent should accept. Mike Hansom replies: In looking for an agent who prioritises your property over that of their other clients, you might struggle to find a reputable agent who will agree to work with you. I anticipate most agents' standard terms and conditions say something like they will 'use their best endeavours to market and sell the property' of all their clients. Agreeing something extra with you that puts their other clients at a disadvantage would breach that kind of term. If word ever got out it would put the agent at risk of legal action from all their other clients. Perhaps more importantly it would cause them huge reputational damage. What could they do instead? Matt Thompson replies: What you can do is agree an official negotiator bonus. I understand that you have agreed a flat fee with your agent. This may or may not be the best option for you as a flat fee doesn't really incentivise an agent to prioritise your property. Instead, we would advise you to agree for the agent to receive a set percentage of the sales price which can range anywhere from 1 per cent to 2 per cent and present a bigger incentive than a flat fee would. Best mortgage rates and how to find them Mortgage rates have risen substantially over recent years, meaning that those remortgaging or buying a home face higher costs. That makes it even more important to search out the best possible rate for you and get good mortgage advice, whether you are a first-time buyer, home owner or buy-to-let landlord. Quick mortgage finder links with This is Money's partner L&C > Mortgage rates calculator > Find the right mortgage for you To help our readers find the best mortgage, This is Money has partnered with the UK's leading fee-free broker L&C. This is Money and L&C's mortgage calculator can let you compare deals to see which ones suit your home's value and level of deposit. You can compare fixed rate lengths, from two-year fixes, to five-year fixes and ten-year fixes. If you're ready to find your next mortgage, why not use This is Money and L&C's online Mortgage Finder. It will search 1,000's of deals from more than 90 different lenders to discover the best deal for you.
