Residential mortgage lender Gen H has updated its affordability modelling to give new build buyers a borrowing boost, reflecting the lower running costs that come with higher EPC ratings.
New build homes are typically far more energy efficient than older stock, meaning lower monthly energy bills for buyers. Gen H's revised model now factors this saving into affordability calculations, allowing new build applicants to borrow more than they could under the standard model.
For example, an applicant earning £50k, with a £50k deposit and £300 a month in existing loan repayments, would see their maximum borrowing on a 2- or 3-year fix rise from £249.6k to £253.8k. In a market where affordability is stretched and many buyers fall just short of what they need, a change like this can be the difference between successfully purchasing a home or staying locked out.
Sara Palmer, Sales and Distribution Director at Gen H, said: “It's important to reward energy efficiency in housebuilding wherever we can – it’s better for people and for the planet. This tweak to our modelling rightly recognises the positive impact new build homes can have on the monthly budget, and will help unlock doors for families right on the edge of affordability.”
