The new product offers bridging loans of up to £600,000 to purchase a property or remortgage a current loan and complete a scope of work to improve energy efficiency over an 18-month term. Monthly rates start at 0.99% at 75% loan to value (LTV). It is initially available on residential properties across the North West.
Penny Ridgway, development relationship manager at Charles Street, said the product could be used to repurpose buildings or renovate portfolios at scale with structured finance built around the refurb bridge offer.
She said: “Over half (56%) of homes in the North West are estimated to have an energy performance certificate (EPC) rating of D or lower, which means that there is a lot of pent-up demand to upgrade housing stock for residential or rental use. We have listened to our customers and understand that they want a funding partner that can help with access to fast finance to purchase a property but also support them with a lower rate once remedial works have been completed within a maximum 12-month period”.
While the monthly start rate is 0.99%, this drops once a green project reaches a better EPC rating following energy saving measures such as the installation of air source heat pumps, insulation or triple glazed windows. Rates on achieving an EPC C rating drop to 0.95%, while B-rated buildings have monthly rates starting at 0.85%, and EPC A 0.8%.
The green refurb bridge caters for experienced property professionals looking to make energy efficiency improvements, which may also improve rental yields or be more attractive to buyers if they are planning to sell, Ridgway said. She added that Charles Street plans to test demand for the new product in the North West, ahead of rolling it out nationally.
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Landlords are under pressure to meet the government deadline of a minimum C Energy Performance Certificate (EPC) rating for rental stock by October 1, 2030.
