The real estate sector is continually looking for new ways to be sustainable and environmentally friendly, and there are countless examples of companies taking green initiatives.
Today is World Habitat Day, established by the United Nations to get people thinking about how they develop land for housing. It focuses on our responsibility to protect people, flora and fauna and the earth when building and maintaining homes. This is a topic close to our hearts at Foxtons. So this week we're featuring information about making the habitats we live in greener.
Hammerson, a renowned retail development company, is committed to achieving net positive carbon, water, resource use and socio-economic impact by 2030. Land Securities seeks to minimize the impact of supply chain emissions by prioritizing supplies made from recycled materials. . Taylor Wimpey has pledged to increase natural habitat by 10% on new sites by 2023. Barratt Developments has confirmed that 100% of its electricity will be generated from renewable energy by 2025. 
With more and more properties being designed with the environment in mind, green mortgages are likely to play an important role in the ongoing conservation trend, but what exactly are green mortgages and who can take advantage of them? Maybe?
Overview of green housing loans
Green mortgages are products that lenders can offer if buyers can prove that the property they want to buy meets certain environmental standards. The easiest way a lender can establish this is through an EPC rating, and lenders often require an A or B rating (sometimes receiving a C rating) to offer green mortgages. Masu.
For more information on EPC ratings, see EPC Information.
Newly built homes often come with sustainability ratings, so it's relatively easy to determine whether your home has a high enough rating. However, in older homes it is not always so simple. In that case, if the buyer can demonstrate that they intend to invest in enhancing the environmental performance of the property, it may be considered for a green mortgage.
The idea of green mortgages is to encourage buyers to purchase a property with built-in green certifications or commit to renovating an existing property to make it more environmentally efficient. Green mortgages tend to have lower interest rates or allow buyers to borrow more, and given that green real estate typically has lower operating costs, buyers end up saving a noteworthy amount of money. It may be possible.
Why do lenders prefer “green” properties?
Lenders want to minimize risk as much as possible when providing the financing you need to buy a home. Properties built with sustainability in mind are almost always cheaper to operate. This means that it is considered a low-risk investment as the borrower is less likely to face financial problems and is less likely to default on the loan.
Also, generally speaking, green real estate retains its value better than properties without green certification. This means there is even less risk for any lender to take on, thus making the loan a much more attractive proposition.
Improvements to existing properties
There are many ways to make your existing property more environmentally friendly. The most effective examples are:
– Installation of high-quality insulation
– Get double (or triple) glazed windows
– Invest in an efficient heating system
– Installation of solar panels
– Wind turbine installation
・Utilization of biomass heating
Depending on your budget and the property itself, some of these changes are definitely more doable than others, but take a moment to consider the financial differences that can make both in the short and long term. It's definitely worth the investment.
ahead of the curve
As you progress, you'll find more and more reasons to go green. By 2025, all landlords will require an EPC rating of at least C for new tenants. By 2028, EPC assessments will be mandatory for all tenants, new and old. This is part of the government's aim to ensure that all homes across the UK are EPC rated C or above. These EPC rule changes may impact your access to green mortgages, so it's worth getting your mortgage early. You may be able to cover some of your modernization costs by refinancing, so be sure to talk to your mortgage advisor when making plans.
How to get a green mortgage
If you would like to find out more about green mortgages or think you could benefit from obtaining a green mortgage, please contact Alexander Hall, one of London's leading mortgage brokers. This will give you a solid idea of what is available to you and what you can do to make yourself and your property more attractive to lenders.
