LENDERS Core Report: Improving energy costs in mortgages, promoting energy efficiency in homes

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This is the final report of the UK LENDERS green mortgages project, which was set up to analytically examine the link between property energy efficiency and fuel bills, and ways in which this link could enable homes with better energy performance to be able to demonstrate lower fuel costs in a way that can be passed on as a tangible benefit to homebuyers.


Privately owned residential properties represent approximately 15% of the UK’s overall carbon emissions, but the 14.9 million privately owned homes are also one of the most difficult built environment sectors in which to implement energy efficiency improvements.


Through the use of comparatively large data sets, LENDERS project has been able to map the relationship between property energy performance and household fuel bills. It has created a working calculator through which homebuyers can access, with the provision of limited property and household information, estimates of their likely bills before they have purchased the home.



Key Findings


Having identified the issue, the project investigated whether these more accurate predictions of future fuel bills could be utilised at different points in the mortgage process, and whether it is appropriate to apply the more accurate LENDERS assumptions on fuel expenditure to affordability calculators.


The findings suggest that there are likely to be opportunities for mortgage lenders to improve the accuracy of the data that they use when assessing affordability to more closely reflect the actual energy performance of a home and its occupants. This could then be used to inform and encourage homebuyers.



To download the report, please visit the relevant UK Green Building Council webpage at the link below.