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How sustainability is changing the housing market
Sustainability has become an essential goal for many different businesses over the last few years, where sectors would look at how environmentally conscious they are being. One of the main sectors that’s seeking out to include sustainability and tackle climate change is the housing market.
According to Lloyds Bank’s Sustainability in Housing report in 2021, homes currently account for 23% of the UK’s total carbon emissions and 35% of energy use. They stated ‘For housebuilders, this means strategies for creating great places whilst delivering ‘greener’ homes that work for both the environment and the home owner. For residential landlords, and in particular housing associations, it requires them to face up to the huge challenge of retrofitting their portfolios that will ultimately benefit some of the poorest in society whilst also reducing carbon emissions.’
Since the UK government set out a target to reduce carbon emissions and greenhouse gases to zero by 2050, housing providers have been set the challenge of incorporating energy-efficient aspects into their homes.
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One of these strategies is the ‘Future Homes and Buildings Standard 2025’ which are a set of objectives that will ensure every new build home after 2025 will cut carbon emissions by 75%-80% compared to the homes built before. Property developers have implemented plans to introduce many energy efficient assets to homes such as low carbon heating, solar panels, smart meters and LED lighting. Homes that are built during 2020 until 2025 will still have gas boilers installed but there are plans in motion to replace these with a low carbon alternative.
Landlords have also made plans to make their properties more energy efficient. By introducing more sustainable products such as better insulation and efficient lighting sources like LED bulbs, they have helped their properties’ EPC ratings to rise.
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A growing number of mortgage lenders are now introducing green mortgages, which support and reward landlords or homeowners who are either buying an energy efficient home, or who are making the changes required to bring it up to standard. The lender may offer a better interest rate or cashback to encourage landlords and homeowners to look into the benefits of owning a greener property and support the borrower with an incentive to invest in adding greener materials to improve their environmental performance.
At Foundation Home Loans, our Residential and Buy to Let green mortgage ranges include mortgages for properties with an EPC rating of C and above, with a range of features to support people who are making greener decisions for their properties.
The range also extends to clients who have an irregular income; as well as limited companies, and portfolio and non-portfolio landlords with HMOs and short term lets.
An additional effect, and maybe the most important one, is that the green agenda has now become a significant consideration for all businesses across the property and mortgage industries, who are now looking at the wider impact of their whole contribution to the environment and climate change. Through this, we can jointly work together to ensure that future generations can benefit from better homes and a more sustainable living situation.
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https://www.lloydsbank.com/business/resource-centre/insight/sustainability-housing.html
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