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Brokers! What's the impact of timber buildings on mortgages

Journalist: Tom Haynes, Daily Telegraph

ended 12. March 2025

Hello! I have two questions for brokers, for stories in the Daily Telegraph.

  1. With eco-friendly new builds increasingly making use of timber in construction, I'm eager to know whether this will likely impact the type of mortgage a lender is willing to offer
  2. Secondly, are lenders offering better mortgage rates to homes with better EPC ratings? If so, what sort of differences have you seen?

Best,

Tom.

3 responses from the Newspage community

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Editor
Jamie Elvin
Director at Strive Mortgages
Timber-framed homes can present challenges for mortgage lenders, particularly when it comes to resale value and durability concerns. While modern engineering has improved their quality, some lenders remain cautious, meaning buyers may face fewer mortgage options or stricter lending criteria. That said, demand for eco-friendly homes is growing, and we may see lenders adapt over time. On EPC ratings, green mortgages are gaining traction, with some lenders offering discounted rates for energy-efficient homes. While the rate reductions aren’t game-changing—typically 0.1% to 0.5% lower—they reflect a growing push towards sustainability in the housing market
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Editor
Pete Mugleston
Mortgage Advisor & Managing Director at onlinemortgageadvisor.co.uk
Timber-framed new builds can be a bit of a mixed bag when it comes to mortgages. Some lenders are totally fine with them, especially when built using modern techniques, but others can be more cautious, seeing them as ‘non-standard construction.’ This could mean fewer options or lower loan-to-value limits, so getting the right lender is key. We are seeing more ‘green’ deals on EPC-linked mortgage rates, with some lenders offering slight discounts – typically 0.1% to 0.2%—for A- or B-rated homes. It’s a nice perk but not always a game-changer, so borrowers should focus on the best overall deal, not just the green incentive.
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Steve Humphrey
Adviser & Founder at The Mortgage Pod
I've recently tried to mortgage a timber-frame house with timber cladding and have come up short. The general feeling is that timber-frame houses require brick or masonry exterior cladding to be considered acceptable security. We specialize in mortgages for non-standard construction properties; however, this one, in particular, was a real challenge, and we were unable to help. However modern timber frame houses tend to meet lenders' criteria and can be less of a challenge. We are seeing more lenders offering 'Green' mortgages, which typically require an EPC rating of A or B. These mortgages can provide real savings to borrowers.