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Driving net-zero targets with ‘green’ mortgages 

Guest blog by Stewart Little, CEO of IRT Surveys and Colin Fyfe, CEO of Hinkley & Rugby Building Society

Despite growing interest in environmental issues and rising mindfulness of climate change, consumer awareness of green finance remains low. According to the Intermediary Mortgage Lenders Association Green Mortgages Autumn 2020 report, 43 per cent of consumers have never heard of a green mortgage[1].

Throughout the UK, there remains a ‘massively underestimated’ demand for sustainable homes[2]. Nearly two-thirds (63 per cent) of the prospective home buyers surveyed indicated a desire to purchase a sustainable home, while 38 per cent said they intended to buy a property with features such as thermal wall insulation, efficient boilers and renewable energy supplies[3].

According to a survey from NatWest and IHS Markit[4], 52 per cent of homeowners have plans for green home improvements over the next decade, however funding and a lack of finance options remain amongst the biggest barriers to carrying out energy-efficiency improvements.

To address this, building societies need to do more to catalyse immediate change, including developing a portfolio of financial solutions to mobilise take-up on a national scale. Particularly given the pace of uptake required to meet the Government’s accelerated 2050 net-zero carbon targets.

The financial pathway to retrofit at scale

The value of a proactive approach to green finance solutions is already being demonstrated by Hinckley & Rugby Building Society – an organisation at the forefront of sustainability initiatives, and a building society striving to become carbon neutral.

The proverbial saying goes ‘a problem shared is a problem halved’, and for the progressive building society it is cross-industry collaboration that is driving greater value for its members, and playing a key role in helping members realise the true benefits of ‘green’ mortgages.

The financial advantages of lower interest rates, combined with the promise of lower energy bills – particularly in current turbulent times – and greater savings in the long term, should certainly drive the appeal with consumers. Nonetheless, the UK has yet to experience the demand for specialist mortgages of this nature that might have perhaps been anticipated.

What Hinckley & Rugby Building Society has quickly realised is that until members can truly understand what reducing carbon emissions means to them, they may be unlikely to opt for a mortgage that moves away from the traditional offer they have grown accustomed to and understand.

Capitalising on a blossoming trend

As a forward thinking institution, Hinckley & Rugby Building Society remains at the forefront of sustainability and green initiatives. It was the first UK building society to undertake carbon literacy training approved by the Carbon Literacy Project, with almost 10% of the workforce undertaking training to build knowledge and awareness of climate change, and the ability and motivation to reduce emissions.

“As Chair of the Building Societies Association Green Finance Task Force, I am particularly proud that Hinckley & Rugby Building Society staff have been able to benefit from this valuable training, which, when combined with the results of the IRT Surveys reviews, will enable them to speak with confidence and knowledge to our members on this important topic.”, said Colin Fyfe, CEO of Hinckley & Rugby Building Society.

Keen to address a lack of knowledge in society generally when it comes to carbon emissions, the lender has teamed up with IRT Surveys, one of the fastest growing thermal imaging and net-zero software specialists in Europe. The collaboration will not only provide members with an insight into how to make savings by reducing emissions, but also drive a positive change in the mortgage market.

Initially being rolled out across 100 homes – with plans to contact all of its mortgage customers for a wider roll-out – the survey will utilise impartial thermal performance analysis, energy efficiency evaluation and dedicated software to report on the homes and explain what will be required to get to ‘net carbon zero’.

Access to the new green finance solution, designed to fund green retrofitting improvements to improve their EPC rating, is underpinned by previously unseen impartial insights and expertise. Amid growing condemnation of ‘greenwashing’[5], the aim is to better educate members and build their trust by showcasing real-world benefits free from bias.

Such insights will help members to understand the current situation of their properties including existing energy inefficiencies, the investment required in order to rectify these, and what return on investment they stand to gain before commencing a large scale retrofit or refurbishment project.

The result will be a service which will allow the borrower to understand the roadmap to improving and retrofitting their home.

For further information about HRBS visit, or visit to find out more about IRT Surveys.






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