According to a new report published by a consortium of industry experts including the UK Green Building Council (UK-GBC), if more analysis is undertaken into the energy efficiency of a home then this can be used by mortgage lenders to determine if a higher level of finance can be awarded. This, in turn can create an impetus for buyers to buy energy efficient homes and for house-builders to invest in energy efficient technology.
The Lender’s Project wanted to demonstrate that improved research and analysis of likely household energy bills could improve mortgage affordability assessments, which would potentially allow homebuyers to access higher loans. It analysed data for 40,000 properties and demonstrated the link between energy efficiency and household fuel bills.
Richard Twinn, policy advisor at UK-GBC, said: “Energy bills are one of the largest costs associated with running a home. But most homebuyers don’t typically consider energy efficiency when they’re making decisions about the right property for them.
“This new research shows that if lenders use information about a property’s energy performance when making lending decisions, this could encourage home buyers to choose more efficient homes by increasing the size of mortgage available for these properties.
“Over time this could provide a major driver to link energy performance with property value, and encourage homeowners to install energy efficiency measures in their own homes”
Andrew Sutton, associate director of the Building Research Establishment (BRE), said: “Our research indicates that low energy homes potentially enable homebuyers to borrow more than those buying poor performing homes. Put simply, energy efficiency brings smaller energy bills, which if captured when calculating mortgage affordability could allow buyers to take out a larger loan.”
The growing feeling that renewable energy can save homeowners money means that interest in renewable energy such as solar has begun to grow. New research conducted by E.On, the electric utility service provider, found that four in ten homeowners said that they would like solar panels and / or an electricity battery storage system by the end of 2020. This is said to be testament to the growing popularity of renewable energy and increasing commitment to reduce our carbon footprint.