Bridging for a Better World

Posted by Market Financial Solutions on 12th November 2021 -

With autumn in full swing, we can probably all admit that we’ve reached for the thermostat on more than one occasion already. But are there alternative ways to keep ourselves toasty during the winter months? How could bridging finance help fund these changes?

Earlier this year, the government announced that new tenancies in buy-to-let properties will need to have an Energy Performance Certificate (EPC) rating of ‘C’ or above by 2025. The minimum rating currently stands at rating ‘E’. This means that landlords will soon only have 3 years to update their property portfolios, to reach the minimum requirement. All buy-to-let assets will need to match the ‘C’ rating law by 2028. Efficient properties are a good way to attract new tenants. Lower utility bills allows landlords the opportunity to charge a more premium monthly rate.

The UK aims to reduce emissions by 80% to ‘net zero’ greenhouse gases by 2050. This means that the level of emissions produced needs to match the amount released into the atmosphere. To do this, we need to look at the way we build UK property and how we can introduce more efficient ways of running them.

Source: Committee on climate change

What defines an ‘Eco Home’?

There are many names for eco homes – ‘sustainable housing’, ‘environmentally friendly homes’ – but they all have one key focus. An eco-home should improve the asset’s energy efficiency. Their design should minimises the impact on the environment.

Ways to improve energy efficiency:

There are a variety of technique which you can implement to improve a home’s energy efficiency. Even the smallest actions can hold significant changes:

• Utilising locally sourced materials, to reduce the amount of fuel used in transportation
• High levels of insulation
• Avoidance of plastics and use naturally sourced materials such as timber
• Larger windows to introduce good levels of day light
• High air-tightness levels to minimise draughts

If you’re looking to improve the sustainability of your property through renovations, then our permitted and light development bridging loan could help.

Small changes you can make

There are plenty of small changes you can make to your property.  Potential buyers are become increasing more environmentally conscious. Therefore, installing eco-friendly materials and technologies could improve interest for property investors. Items that improve efficiency can increase the overall property value by as high as 14%.

Source: MoneySupermarket.com

Great selling points could be the introduction of elements such as:

• Double or triple glazing
• Solar panels
• A heat pump
• Mechanical ventilation with heat recovery system (MVHR)

Introducing elements could help you get the most of your money in long-term savings, whilst minimising their impact on the environment.

Household efficiency tricks

There are many small tricks within the household that you can implement that could help increase your home’s efficiency.

Implementing smart home technology for tenants can also be a great way to reduce and manage energy usage. Using smartphones to control temperature and operate lights is also quickly becoming a popular method. By the end of June 2021, government data shows 25.2 million smart and advanced meters are now in operation across the UK, for homes and small businesses.

Other small integrations include:

• LEDs instead of halogens
• Composting toilets
• Waster mist systems

Source: Gov.uk 

Larger scale projects

Investors of property should be looking to include as many environmental elements in future refurbishment projects as possible, if they’re looking to meet the EPC ‘C’ rating deadline. Improving energy efficiency to attract buyers is an eco-friendly way to help increase property resale value – as mentioned above.

Most common techniques used include increasing the amount of insulation or enhancing door seals to provide draught-proofing. But there are other ways you can add value whilst creating a more environmental-friendly property:

1) Rainwater harvesting

Rainwater harvesting relates to the collection of wasted water from the roof. This is stored and then re-used across the property – both in the home and garden. It can reduce the water bill and provides a more sustainable way of living.

2) Glazed Windows

People are looking to spend more time in their homes due to the increase of working from home. Homebuyers are therefore looking for larger properties that create an open and bright feeling. Installing larger windows to increase the amount of natural light in a property is good way to reduce energy used for lighting. However, ensuring windows are double or triple glazed is fundamental to this. The natural light can also help enhance the feeling of the property being quite spacious, particularly against paler painted walls. A great bonus feature for potential buyers.

3) Heating recovery ventilation systems (HRVS)

HRVS extract the moist and warmer air from the house – mainly bathrooms and kitchens – and uses this to heat the fresh air coming in. It then evenly distributes this air throughout the key areas of the house, such as sitting rooms and bedrooms. Simultaneously, it ventilates the stale air, originally collected, back outside. By utilising the collected heat, it reduces the amount of wasted energy. Whilst evenly spreading fresh air readily at room temperature across the property.

Bridging refurbishment loans

Bridging refurbishment loans are a form of short-term finance that allows property investors, homeowners, or landlords to start works imminently. Whether you’re looking to fund a conversion or renovation project, the flexibility of bridging means that the finance:

• Could be with you in as little as three days
• Is available for a wide range of property types
• Can help renovate a singular or multiple assets

If you’re considering refurbishing your property, then a fast-bridging loan may be a good solution. With more people working from home and spending time indoors, the desire to refurbish remains strong.

To speak to our underwriters about a refurbishment loan, click here.