New ‘green mortgages’ could cut homeowners mortgage rates, bills and emissions
Thanks to a £10 million innovation fund, customers could take advantage of discounted mortgages and save money on energy bills and emissions by upgrading the energy rating of their home.
Ahead of the launch of the Green Finance Strategy, which will be published on 2 July 2019 and will set out the UK Government’s green finance objectives and ambitions, a £5 million fund has been announced to help the financial sector develop green home finance products, like green mortgages.
The Government has also announced that it would offer industry the chance to win a share of a £10 million innovation fund if companies designed innovative ways of reducing the cost of retrofitting the UK’s old housing stock which could include assembling parts of buildings like pre-fabricated roofs or facades off-site and quickly fitting them to homes, minimising disruption for homeowners.
The innovation fund:
- £5 million fund to increase number of green mortgages will encourage households to upgrade energy efficiency of homes, as part of the Green Finance Strategy
- Industry is encouraged to cut cost of retrofitting older homes with £10 million innovation fund
- Improve energy efficiency of 17 million homes as part of UK’s commitment to become a net zero emissions economy
It comes just days after the Government became the first major economy in the world to pass laws committing the UK to net zero emissions by 2050. Tackling domestic emissions by improving the efficiency of the 17 million homes in the UK with an EPC below Band C will be essential to achieving this.
The Governments work in making the UK greener:
- The Chancellor announced last year the establishment of a new Green Finance Institute with an ambitious mandate to accelerate green finance investment.
- Amended pensions regulations to strengthen and clarify investor duties.
- Sought further evidence on improvements to EPCs through a Call for Evidence.
- In January 2019, the Government and UK100 delivered its first Investing in Local Energy conference to help attract private investment into local projects.
Energy and Clean Growth Minister Chris Skidmore said:
“To fulfil our world-leading commitment to reach net zero emissions by 2050, we need an overhaul of our housing stock to tackle the disproportionate amount of carbon emissions from buildings.
“By rolling out more green mortgages and reducing the costs of retrofitting older homes we’re encouraging homeowners to improve the efficiency of their homes and save money on their energy bills, helping to ensure everyone has access to a warm and comfortable home.”
The GHFIF will support the development of lending products like equity loans and home improvement loans that will help homeowners make upgrades, for example offering energy efficiency advice, access to trusted installers and preferential mortgage interest rates to support them in making energy improvements to their homes.
Funding will be awarded to innovative projects that incentivise energy efficiency retrofitting through the Green Home Finance Innovation Fund (GHFIF). Bids are welcome from any organisation or consortium from across the UK, including SMEs, large enterprises, academia, financial, research, public and third sector organisations. If you are interested in entering the competition or would like more information, visit the Governments online Whole House Retrofit Competition guidance.
What Propertymark is doing
NAEA Propertymark responds to consultations across the UK to call for change in order to strengthen the industry.
The UK-wide funding ties into NAEA Propertymark’s response to the Scottish Government in June 2019 on Energy Efficient Scotland where we stressed that owner occupiers need incentives and funding to make energy efficiency improvements to their homes.
Kindly shared by NAEA Propertymark
