Now, more than ever, climate change concerns are becoming more prevalent than perhaps any other time in our recent history. The government have implemented many strategies across society to reduce the effects of the current climate crisis. For example, the Climate Change Act has seen the UK government pledge to reduce greenhouse gas emissions down by at least 100% of 1990 levels by the year 2050. This is being done by bringing in policies to support renewable energy production, as well as placing limits on the production of non-renewable energy sources such as oil, coal and gas.
So how is the mortgage market involved?
According to UK Government national statistics, residential properties make up 15% of total UK climate emissions. Because of this, many mortgage lenders have begun to recognise the importance of combatting the effects on climate change within the UK housing market. For example, one mortgage lender has released a sustainability spotlight report, within which they outline the various action groups they have started. One in particular, the Green Homes Action Group, helps to tackle obstacles related to net zero homes. A net zero home refers to a home with net zero energy consumption. More precisely, this means that the total amount of energy used on an annual basis is equal to the amount of renewable energy created on site. The Green Homes Action Group aim to explore how a national retrofit strategies from the government could help to drive change in the net zero home industry. They also aim to ensure that all homes built moving forwards are sustainable and future proofed to evolving measures/legislation. The lender in question also provide their customers with expert knowledge on how they can improve their existing homes to become more green and energy efficient.
This is a valiant effort on their part, one that will benefit future policy in the housing market. However, other lenders are taking it a step further by incentivising customers to improve their carbon footprint.
“Green Mortgages” can offer reduced rates, as well as cashback to customers with homes who meet their energy consumption standards, supported by an active Energy Performance Certificate (EPC) rating of A or B.
Green mortgages are beginning to be offered by a multitude of lenders, including many on the high street, which shows a sharper incentive towards making our future a more sustainable one.
Published by Sara Doyle.