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Leeds improves affordability assessment for energy-efficient new builds

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  • 12/07/2022
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Leeds Building Society has enhanced mortgage affordability for the most energy-efficient new homes to benefit buyers of greener properties.

The mutual said it was able to use more detailed data about projected fuel bill savings for new-build homes with an A or B EPC 1 rating, enabling customers to borrow more than on an equivalent, less energy-efficient property.

Last year, Leeds introduced green mortgage deals offering preferential rates and cashback deals for the most energy-efficient homes, as part of its efforts to link its products with positive environmental impact.

The mutual was also the first UK lender to offer a carbon neutral mortgage, where it offset the forecast environmental impact of each home during the initial fixed term of the mortgage.

This benefit was offered on a trial basis on all its 95 per cent loan to value (LTV) mortgages for purchase, regardless of EPC rating.

Martese Carton (pictured), director of mortgage distribution at Leeds Building Society, said: “Through purchasing energy-efficient new-build homes, customers are not only helping the environment but realising the benefit of lower fuel bills at a time when everyone is affected by the rising cost of living.

“Our improved affordability assessment for this type of property demonstrates the potential savings on energy bills where properties are A or B EPC rated, and what this can mean to a household’s outgoings, such as mortgage repayments.”

Adrian MacDiarmid, head of mortgages at developer Barratt Homes, welcomed the move.

He added: “New homes are built to high energy efficient standards so it makes sense that the savings on bills are reflected in affordability. We put great store in this with 99 per cent of the homes we build either A or B rated.”

“There is an increasingly compelling case for lenders to offer support in this way to the growing number of customers who want to buy an energy-efficient home.”

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