November is the month for conferences. Of course, many of the headlines are going to COP27 but Sharm El-Sheikh wasn’t the only venue for eco based discussion.
It was also a topic at the HL partnership conference for the Mortgage and Protection network, attended by award winning independent mortgage adviser Jo Jingree of Mortgage Confidence.
So, how is the mortgage industry playing its part in the work towards the UK’s Net Zero aim for 2050?
One fifth of the problem
In the UK, our homes account for 22% of the UK’s total carbon emissions. If we can make them more efficient that would go a long way towards achieving the 2050 target. Plus, according to LG, in July this year there was a 34 percent increase in the number of searches relating to property energy efficiency.
And with energy efficiency and cost savings on the minds of many, the Association of Mortgage Intermediaries (AIM) has come together with together with environmental groups to create a website to help advisers source information about green mortgages.
What is a green mortgage?
Green – or eco – mortgages are relatively new. Launched in 2018, they essentially reward you for having an energy efficient home. They are generally linked to your property’s Energy Performance Certificate (EPC). This gives your property an energy efficiency rating from A to G. With A being most efficient.
Green mortgages are usually only available on homes that come with an EPC rating of A or B. With a small number of lenders making them available for C rated properties.
The benefits of a green mortgage can vary from lender to lender. Some may give slightly lower interest rates. While others might offer cashback.
How do you get a green mortgage?
As we mentioned before, you’ll ideally need your property to have an A or B rated EPC.
But, as of October last year, the Government said that around 15million homes in England in 2019 were below an EPC band C.
Jo Jingree explains: “The problem in the UK is the age and nature of our housing stock. And whist older properties are often the most desirable, the Victorians and Edwardians were not known for their insulating and draught proofing when it came to house building! My own home is Victorian, so I know this from personal experience!”
A huge number of UK properties will need significant work to improve their EPC rating to an A or B to be eligible for a green mortgage.
According to the Energy Saving Trust, improving your EPC might involve:
- Insulation – wall, floor and loft
- Low energy lighting
- Increased water cylinder insulation
- Improved heating controls
- Swapping single glazed windows for double
- Solar panels
Is it worth improving my EPC?
“Over time, we could see a property’s value become more closely tied to its energy efficiency. Meaning that homes will possibly be less desirable or have a lower value if they are not energy efficient,” Jo adds.
Halifax has recently launched a Home Energy Saving Tool in conjunction with the Energy saving Trust. It helps you to find out how green your home is and shows how a few changes could make it more friendly to the environment. But is it worth making those changes?
Jo sums it up: “Having a more economically friendly home does, of course, also have financial implications in terms of reducing energy costs. Which is very welcome right now! So, it’s definitely worth exploring what you’d need to do to improve your EPC. I used the tool myself and we’re now discussing the merits of solar panels!”
Jo offers a free 30 minute no obligation telephone or video chat. So please do get in touch to discuss green mortgages or any other mortgage related issue.
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