3rd
May 2021
A business mortgage broker claims that three out of five landlords are looking for green mortgages.
The broker recently conducted a survey of landlords which found that not one of the landlords who had purchased their first buy to let property before 2000 had chosen to do so with a green mortgage; during the 1900’s just 10% of landlords who had bought their first buy-to-let properties looked at the green mortgage option when buying them.
Whereas nowadays 62% of landlords claim that they are interested in the green mortgage option when borrowers are given ‘incentives’ – discounted rates - to increase the energy efficiency in their properties.
The research surprisingly found that older landlords are more inclined towards green mortgages than younger landlords.
Just a half of landlords under 45 were not particularly interested in green mortgages, whereas two thirds of 45 + years are happily exploring their ‘greens’.
Jeni Browne, director of the mortgage broker, said: “Much of the UK’s housing stock is very energy inefficient, making our homes a major source of greenhouse gas emissions. Improving the energy efficiency of the UK’s stock of housing is a priority in the fight against climate change. A green mortgage means that, once they can confirm they have a revised energy rating for their property, the right lender will recalculate their mortgage rate at a discount. There are various mortgage products out there but the best are applied on completion of an energy efficiency project and applied for the lifetime of a mortgage. Given housing accounts for such a significant chunk of the UK’s carbon emissions, it’s great that landlords are so interested in making greener choices - spurred on, no doubt, by the fact landlords are rushing to upgrade their properties to meet new EPC rating rules by 2028. Whatever the reasons, landlords now appear interested in joining the battle to combat climate change. That hasn’t always been the case.
“We started trading in 1990 and the findings of our poll match our experience of the market over the last 30 years. Landlords’ attitudes have changed dramatically, particularly in the last decade. Landlords should be interested in these products though - quite apart from the ethical considerations, green mortgages reward landlords with a lower rate when they shrink their carbon footprint.
“Hopefully, our research will help drum up more lender supply. The UK’s largest lenders have launched a wave of climate-change products amid criticism over their slow response to global warming. For instance, one of the big lenders did launch a Green Mortgage last year and we’ve seen others follow suit but have only offered borrowers preferential rates when they purchase an energy efficient property - rather than rewarding those improving the ecological footprint of the UK’s housing stock. It’s not enough and that’s why they have failed to impress campaigners. Given Britain has just enjoyed the greenest Easter on record, with almost 80% of the energy used at lunchtime on Easter Sunday coming from zero-carbon sources such as solar and wind, the industry is in danger of falling behind the times unless we do our bit."
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