www . simplybizmortgages . co . uk 27 ing or owning an energy-efficient home , by offering them more favourable terms or incentives to pay for green home improvements , not seen with the more standard deals . This can be in the form of a slightly lower interest rate , or cashback when you take out the mortgage , or even both . It could also be that they are restricted only to those buying a new property where all that work has already been done . The government has committed its support of a competitive market in this area and has even now imposed targets for financial institutions to provide this service . [ 2 ]
However , one area where the stars appear to have aligned at the moment is in Buy-to-Let , where due to new government regulations , landlords are being actively encouraged to ensure their properties have a band rating of C or above for new tenancies of six months or more , with more to come in years following .
With all these different approaches , finding the right green mortgage to suit your client could come with a requirement for significant research , as sourcing systems are only just reviewing their approach .
EPCs – heros or villains ?
It depends on your approach and your financial situation , but they are key to understanding energy efficiency of property types and therefore the achieving of that target , but there is encouragement needed across homeowners . These certificates are now a requirement whenever a property is sold , rented , or for new builds . This rating is not applicable to the millions of homes currently occupied by owners or renters who have been in position for a number of years . Only when that situation changes , will the EPC requirement kick in . Interestingly , not many people know how energy efficient their homes are and to support their understanding of the current state of their property , EPC ratings can be found on the government site under ‘ find an energy certificate .’
The future – does green have longevity or is it a fad ?
Given all of the above , it is perhaps unsurprising that only a limited number of advisers have actually advised on green mortgages . Add into that recent research from Habito which looked at the public ’ s understanding of green mortgages , where 81 % of mortgage-holders didn ’ t know what a green mortgage was , and there is education needed across the market to make a significant impact . Interestingly Habito says that once the principle was explained , 87 % said they would definitely consider one .
It seems from that response , there could be a strong future , if our clients can meet their requirements . As more purchasers come to learn of the advantages , I would expect you will find more of your clients start to ask about them as a viable way to buy their next home or to remortgage – if you haven ’ t at that stage already raised this as an opportunity . How many may move away from them once you get down to the hard facts , is an unknown , but the will is there in certain sectors .
GROWTH AREA
The green approach is set to get stronger , but the government needs to support in various ways , whether that be financial or regulatory , and care and thought needs to be given to ensure green mortgages don ’ t become the domain of ‘ the haves ’. They need also to support ‘ the have nots ’ and make the opportunity within their achievable aspirations to really make the required impact . At this stage , we will continue to keen a watching brief on this growth area for the future .
Sources : 1 . UK greenhouse gas emissions , provisional figures . Available on the www . gov . uk site . 2 . Government ’ s Heat and Buildings Strategy is available on www . gov . uk .