Leeds improves affordability on greener homes

Leeds Building Society is changing the way it assesses mortgage applications on modern 'greener' properties.

The upgraded affordability calculator takes into account the reduced monthly outgoings on utilities associated with newer, more energy efficient homes, meaning increased lending allowances for mortgage applicants.

The update gives customers improved affordability for homes built since 2020, and factors in the type of property a customer is seeking a mortgage for.

For example, a customer seeking a residential mortgage up to 90% LTV against a new build standard property valued at £225,000 could borrow £210,000 versus £199,000 on a non-new build property.

Richard Rothwell, commercial development manager at Leeds Building Society, said: “This latest innovation is part of our ongoing work to support our members in reducing their carbon footprint. Housing is responsible for 16% of the UK’s total emissions, so it’s important as a lender that we play our part. Thanks to the changes we have made, we can help more customers get the greener home they want."

Emma Harvey-Smith, programme director at the Green Finance Institute, commented: “It is wonderful to see Leeds Building Society offering customers improved affordability on greener properties. To successfully decarbonise the UK’s housing stock we need to encourage more and more people to live in energy efficient homes. Incentives such as preferable mortgage rates for greener homes - combined with increasing consumer awareness - will be vital to boost demand. Mortgage lenders and intermediaries will play a key role in educating homeowners which is why the Green Finance Institute launched the Broker’s Handbook – a first-of-its-kind resource that provides key information on the different green home retrofit solutions and technologies available to consumers.”