The LENDERS green mortgage project brought together a wide partnership with a collective aim to realise cost savings from energy saving measures through mortgage lending.
Andrew Sutton gives an overview of the project objectives and why there is great potential for driving energy efficiency through financial incentive schemes such as LENDERS.
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LENDERS – EPC Mortgage
Andrew Sutton, Associate Director BRE Wales who conducted the research said ‘This project is about using normal market forces to introduce energy efficiency into residential values through enabling those looking to buy an energy efficient home to have more in their pocket. This could affect the hard to reach privately owned homes to refurbishment as well as support the Chancellor’s funding for 400k starter homes.’
Supported and part funded by Innovate UK, the research draws on the expertise of diverse groups with green credentials, including Principality Building Society, UK Green Building Council, Zero Carbon Hub, Constructing Excellence in Wales, Energy Saving Trust, Arup and University College London (UCL).
Andrew Baddeley-Chappell, Head of Mortgage Policy at Nationwide, said: ‘The research will look at ways of moving away from current estimates of energy costs and towards more detailed affordability calculations based on the individual property. Fuel charges are the largest unavoidable household costs and may vary by a large degree. Such detailed data could allow lenders to acknowledge that smaller fuel costs could allow more to be borrowed on the mortgage, nudge buyers towards more efficient buildings and potentially reflect the added value of such properties.’
The LENDERS project derives from two reports into construction, lending and energy efficiency. One was produced by BRE Wales and funded by The Wales Low/Zero Carbon Hub,while another piece of work was produced by UK GBC in partnership with UCL. Now a wider group is expanding on the earlier research to create a larger study into the feasibility of influencing property choices and lending practices through energy efficiency.