The latest data from Mortgage Advice Bureau has revealed that almost six in ten mortgage lenders now offer a green mortgage.
More mortgage lenders have green mortgage deals on the market now compared to a year ago, with 57% of mortgage lenders now offering such products - a 4% rise on last year, according to new data from Mortgage Advice Bureau.
The research, which polled some of the UK’s largest mortgage lenders, found that 59% believe that green or net zero/energy efficient mortgages will become a permanent part of their future mortgage product range.
12% of lenders go further, stating they believe green mortgages will become the norm and completely replace mortgages as they are today.
Whilst some lenders agree that green mortgages will play a big part of their future mortgage product range, that doesn’t mean all traditional mortgages will be replaced. In fact, the vast majority (84%) of lenders agree that green mortgages will only form part of the mortgage market.
Despite more lenders offering green mortgages, many believe the sector has remained largely unchanged in the past 12 months (61%). This number could be higher, as a quarter (24%) of lenders aren’t sure whether there have been any significant changes in the green mortgage sector.
In fact, just one in seven (14%) lenders believe there has been noticeable progress in the green mortgage space.
Against what has been a turbulent year for both lenders and borrowers, the findings show that for some lenders, there are other challenges that have (and may continue) to take priority as they meet borrower demand.
39% see the expansion of mortgage products to meet more diverse borrower needs as the most pressing, while 16% say there is a need to address the affordability challenges of traditional mortgages to broaden the number of borrowers they can support. For 14%, it’s managing the ongoing effects of interest rate fluctuations.
Ben Thompson, Deputy CEO of Mortgage Advice Bureau, comments: “Climate change is an issue we all must act on, and the uptick in green mortgage products on the market is encouraging news.
"It’s important that this shift stays front of mind for both the industry and property owners, as energy bills and what we can do on an individual level to reduce our climate impact stays firmly in the spotlight.
He concludes: “While the country’s net zero targets may seem far away, the reality is that we’re hurtling towards them at a startling rate. At a policy and industry level, we have a responsibility to push the housing market to a more sustainable future - one that is as energy-efficient as possible.
"Green mortgage products (and the wider promotion of these) is one part of the puzzle, and now we must ensure these are being put to prospective buyers.”