Green Mortgage Products
The green mortgage market is growing rapidly in the UK. In 2022, there were over 100 different green mortgage products available, up from just a handful in 2018. This growth is being driven by a number of factors, including the increasing cost of energy, the growing awareness of the environmental impact of our homes, and the government’s commitment to net zero emissions by 2050.
Green mortgages offer a number of benefits to homeowners. They can save money on energy bills, help to reduce their carbon footprint, and increase the value of their home. In addition, green mortgages can be a good way to finance energy efficiency improvements to your home.
There are a number of different types of green mortgages available. Some offer discounted rates, while others offer cashback or other incentives. Some lenders also offer green mortgages that are specifically designed for first-time buyers or people on low incomes.
If you are considering a green mortgage, it is important to compare the different products available and choose one that is right for you. You should also make sure that you understand the terms and conditions of the mortgage, including the interest rate, repayment period, and any fees.
How is the market changing?
The Nationwide building society has recently launched a new green mortgage scheme. The scheme offers 0% interest loans to existing customers for a set number of improvements. The loans are available as a further advance and can be for up to 5 years. After this period the loan will revert to the standard variable rate. A minimum of £5,000 and a maximum of £15,000 means some real improvements could be made to most properties.
The list of acceptable improvements are as follows:
- Solar panels
- Cavity wall insulation
- Pipe and boiler insulation
- Window upgrade/replacement
- Air source heat pumps
- Ground source heat pumps
- Investment in rainwater ‘harvestation’
- Upgrading of existing utilities (e.g. lighting)
- Small scale wind turbines
- Electric car charging stations
The current scheme is limited to 5,000 members. But it’s a scheme the building society intends to closely monitor and may look to expand further.
If you are interested in a green mortgage, you should contact your lender or a mortgage broker to find out more.