The UK Green Building Council (UK-GBC) has joined with mortgage lenders and building industry experts to launch a research project into the link between energy costs, affordability and mortgage borrowing.
Over the next 18 months the “LENDERS” project will build the evidence base for using more accurate estimates of energy bills in mortgage affordability calculations. If successful, this could allow higher lending for more efficient properties and eventually lead to a greater link between efficiency and property value.
Supported by Innovate UK, LENDERS will draw on the expertise of a diverse range of project partners including Nationwide Building Society, Principality Building Society, Zero Carbon Hub, Constructing Excellence in Wales, BRE, Energy Saving Trust, Arup and University College London (UCL).
Members of the project will test the use of Energy Performance Certificates (EPCs) in estimating energy costs in individual homes.
UK-GBC chief executive Julie Hirigoyen said: “With energy bills representing one of the biggest costs that households face, it seems common sense for lenders to take them into account when assessing mortgage affordability. But despite this helping to reduce lending risks and encourage retrofit, it has so far failed to become mainstream practice with banks and building societies.”
“If LENDERS is successful, it could have a transformative impact on the building industry, potentially translating into efficient homes gaining value relative to their inefficient counterparts.”