As the property market begins to warm up ahead of April’s stamp duty threshold changes, Aspect Mortgages, based in Chorley, Lancashire, is highlighting the growing availability of green mortgages, which could lead to significant savings on mortgage payments for buyers.
Founded in 2004, Aspect Mortgages provides impartial mortgage, insurance, and financial advice. The firm, led by husband and wife co-founders Richard and Rachel Gill, has an increasing focus on energy efficiency and has been tracking the rise of green mortgages and advising clients on how they can benefit from the growing range of sustainable lending options.
“We’ve found the majority of people are, as yet, unaware of the significant sustainable savings available, which we’re determined to change,” says Richard. “With benefits for reducing your carbon footprint, heating waste, and utility bills, as well as mortgage payments, it makes sense all round to include the energy efficiency of your prospective or current home, and any capacity to upgrade it, in your considerations.”
Green mortgages offer cashback or lower interest rates for homes with an EPC rating of A or B. Lenders are increasingly offering these incentives as energy-efficient properties are considered less risky, more likely to hold their value, and less likely to result in mortgage defaults due to lower energy costs.
Despite this, many homeowners are unaware of their home’s energy rating. The majority of UK homes are rated EPC D, with 53% of homeowners recently surveyed unaware of their home’s rating, and 62% having little or no understanding of the EPC system. However, 68% said they view improving EPC ratings as a worthwhile investment to cut energy costs and increase property value.
“With greater focus on climate action, plus the impact of utility costs on living expenses and household budgets, energy efficiency is an increasingly worthwhile consideration,” advises Richard. “With Halifax, for example, now incorporating EPC ratings into mortgage affordability calculations as standard, the UK’s green mortgage market has already grown from just 4 products on offer in 2019 to more than 60 today. The first mortgage Aspect arranged this year was a green one, the first of many to benefit buyers, I hope.”
Upgrading from an EPC D to a C rating can save homeowners an average of £723 per year on energy bills. Those not looking to move can also benefit from home improvements, with lenders offering incentives for double-glazing, upgraded heating systems, insulation, and solar panels. Aspect Mortgages marked its 20th year in business in 2024 by making energy-efficient upgrades to its offices, reducing its monthly gas bill from £550 to £180.
“Lenders are recognising the value of ‘green’ home improvements, offering rewards for upgrades like installing double-glazing, upgrading heating systems and insulation, or installing solar panels,” says Richard. “This opens up upgrade opportunities for those considering a lower-rated property purchase, or remortgaging their current home. Whatever the temperature outside, the green mortgage market is definitely hotting up!”
