The World Green Building Council (WorldGBC) Europe network has launched a new report to support the growth of the market so that energy efficient mortgages will be made available to every borrower in Europe.
The report – titled ‘Creating an Energy Efficient Mortgage for Europe: the supporting role of the green building sector’ – argues that the finance and green building sectors must work together closely to provide energy efficient mortgages.
It set out a roadmap for building, construction and energy efficiency organisations to follow that will help the market for green finance to flourish – with the potential to transform millions of buildings across Europe.
Written jointly by WorldGBC’s Europe network and E.ON as part of the EU funded Energy Efficient Mortgages Initiative, the report highlights the importance of considering the needs of the borrower to ensure energy efficient mortgages have broad appeal.
The initiative launched a pilot scheme last year – which also involves the European Mortgage Federation: European Covered Bond Council and the Royal Institute of Chartered Surveyors. It has already seen 46 major banks signed up to develop new green lending products.
What’s more, city and regional governments including the Scottish government have also committed to support the initiative.
With the success of these products, businesses and organisations with expertise in building energy performance can take action to ‘stimulate demand, streamline delivery of energy efficient buildings and renovations and provide extra support to the borrower’, WorldGBC said.
“Green finance is increasingly recognised as a powerful driver for climate action,” Cristina Gamboa, chief executive officer of WorldGBC, said.
“The growth of the energy efficient mortgage market in Europe represents a unique opportunity to unlock new investment to accelerate the decarbonisation of the built environment. We are working with our members to ensure that our sector is equipped to seize this opportunity.”
Marco Marijewycz, senior manager of global business development at E.ON, added: “The successful growth of a European market for energy efficient mortgages can only happen if we put the customer front and centre.”
“E.ON’s consumer insight work shows there’s appreciation across the board of the benefits energy efficient mortgages can offer for property owners; like lower energy bills, increased comfort levels and lower environmental impact.”
He continued: “But for the market to reach mass scale, will require close cooperation between market actors such as banks and energy companies.”
Ursula Hartenberger, global head of sustainability at RICS, explained: “Properties which are below average in their energy efficiency may suffer value erosion as the market and government policy starts to push the need for more efficient buildings.”
“With energy efficient mortgages there is an opportunity for valuers, lenders and businesses that specialize in energy efficiency services to collaborate to help borrowers mitigate this risk. This report is a timely and valuable resource to guide these new collaborations.”
According to WorldGBC, developing the market will only happen if customers understand and believe in the benefits of energy efficient mortgages.
The report analyses market research led by E.ON to help drive the appeal of these mortgage options to the borrower. Financial incentives and the potential to increase property value were cited as the highest rated benefits for borrowers.