Have you heard of the Nationwide House Energy Rating Scheme?
‘NatHERS’ is a star rating system (out of ten) that rates the energy efficiency of a home, based on its design. By providing a ‘measuring tape’ to estimate a home’s potential heating and cooling energy use, NatHERS helps to make Australian homes more comfortable for their inhabitants and also helps residents to save on energy bills through smarter design choices. Often good design can reduce the amount of energy needed to keep a home comfortable with no or little additional construction cost.
There is now a new ‘Green Home Loan’ that offers a sharply-reduced interest rate for construction loans and homes under one-year-old, where the home has a NatHERS energy rating of at least 7 stars.
Borrowers just need to show the home’s 7-star rating, which is typically included in the building plan for all new buildings, and the application will go through the usual approval process. The homes will be among Australia’s most energy-efficient, meeting or exceeding a seven-star rating.
Qualifying green mortgages will allow borrowers to benefit from a 0.4% finance discount for up to five years on loans of up to $1.5 million. Construction loans can receive an interest-rate discount of up to 1.58%.
With the average home having a lifespan of 50 years or more, these investments have the potential to lock in lower energy consumption over the long term, as well as deliver more comfortable homes that are cheaper to run. Only 10% of new homes built last year achieved a NatHERS rating of seven stars or more, and more than 9 million existing homes failed to meet the seven-star standard.
Excitingly for us, the new Green Home Loan will give mortgage brokers a unique offering for customers who are looking for a lender that not only saves them money, but has a conscience when it comes to climate change and sustainable living.