Green market trends

Clients I have talked to over recent years are aware of climate change and the need to do something and with the Government's initiative of net zero emissions by 2050 - when I tell them this part, you can see the client's faces think "OK how much is this going to cost me ?" - clients are stuggling to put food on the table and keep a roof over their head, let alone thinking about making necessary changes to their homes to entertain a "greener mortgage" - In order for these mortgages to work, we need more energy efficent affordable homes being built to correct standards and the government financially helping existing homeowners that don't have suitable energy efficient homes, to make the changes they need - let's not forget there are homes out there that will never be energy efficient based on the age and design of the property, no matter how much money is thrown at it - So even though we all know it's important, Green Mortgages appear on paper at least...a tick box exercise.

The green mortgage market is at best inconsequential. For sure some buyers may utilise a marginally better interest rate if the EPC rating of their property is good enough, but no one chooses a property based upon this or makes greening home improvements to benefit from them. The incentives need to be much bigger to impact the mortgage market at large.

There are a few lenders that offer specific green mortgage products, such as Halifax and NatWest, and the 0% loan option from Nationwide BS, but the saving on the rate or small cashback is no where near enough to make a difference current financial climate, and spending large sums of money on property purely for 'Green' reasons is not going to be high on most borrowers agenda at the moment. When familes are struggling to pay for food, fuel and household costs, the last thing they will worry about is saving £20pm on their mortgage by paying out £5000 for an energy efficient upgrade. More use of government grants, price controlling over cheaper upgrades to existing properties, if the lenders want to get involved then some bigger rates discounts or cashback / vouchers for eneregy imrpovements. But for the next few years this is going to be about surviving for today, and we will worry about tomorrow another day.

Offering customers a discounted rate for environmentally friendly and energy-efficient homes is all well and good - but these banks don't necessarily need to invest the customers' money back into companies that aren't environmentally damaging themselves. It's the customers that are "green" not the lender!

The minuscule savings in rates for clients do not outweigh the costs involved in getting some of the work done for older properties anywhere near the required EPC level to be eligible for a green mortgage so their impact so far has been insignificant even for some of my most environmentally conscious clients.