Green mortgages set to ‘become the norm’

Mortgage lenders are warming to green mortgages, new research from Mortgage Advice Bureau suggests.

Analysis by the broker has found that more than half of lenders say they are now offering green mortgage products compared with just a third this time last year.

Additionally, 98% of those asked said they will offer them in the future if they don’t already.

Furthermore, one in 10 lenders said green mortgages will, in time, completely replace all existing products on offer. 

The research also asked who is responsible for making homes more environmentally friendly.

The majority appear to see it as a shared duty between builders and lenders.

Many have also become more aware of the role they have to play in the efforts to provide energy-efficient housing stock, according to the analysis, with a decrease from 11% last year to just 5% of lenders this year saying it is the responsibility of builders only.

It is this shift perhaps that has also led to 95% saying green mortgages will be a permanent part of their product range, which is up from 92% last year, the Mortgage Advice Bureau said.

Currently, a fifth of lenders have more than five different green mortgage products on offer, however, Ben Thompson at Mortgage Advice Bureau would like to see this increase more and feels the industry can still go further in a bid to achieve net-zero.

He said: “The climate issue is one we must act on, and every lender can play their part. 

“With that in mind, it is really encouraging to see the uptick in lenders offering green mortgages, and letting people know about them is key. With COP27 in Egypt having just finished, the climate is once again front and centre, and we will always help lenders and intermediaries to push green mortgages.”