19 October 2021
A government push (green mortgage plan) for mortgage lenders to reach an average energy performance certificate rating of band C across their mortgage portfolio by 2030, could prompt a fall in the value of older family homes, critics have warned.
In its Heat and Buildings Strategy, published today, the government reiterated proposals that it consulted on earlier this year, which would require mortgage lenders to disclose EPC ratings of their portfolios.
It proposed a voluntary voluntary target to reach an average of EPC band C across their mortgage portfolio by 2030, “with the option of making this target mandatory if insufficient progress is being made”.
Currently only 40% of homes meet this standard.
In order to help achieve its target, the government wants more lenders to offer green mortgages, which incentivise borrowers to make energy efficient upgrades to their property.
However, some are concerned about the impact on those who own older homes that are extremely costly to retrofit, as lenders will be increasingly taking such factors into account as part of their underwriting process.