Zero-carbon homes will be exempt from stamp duty and the Building Societies’ Association says lenders will need to introduce their own incentives to help the environment.
Chancellor Gordon Brown revealed in his pre-Budget report on Wednesday afternoon that by 2016 all new homes should be zero-carbon, and from 2007, the vast majority, but not all, of new zero-carbon homes will be exempt from stamp duty for an unspecified limited period. Full details of the plans will be published in next year’s Budget.
The BSA says the gauntlet has been thrown down to lenders to come up with their own solutions. Housing minister Yvette Cooper said in September that lenders should design “green mortgages”.
BSA head of external affairs Rachel Snow says: “The issue of property, energy efficiency and climate change are in the spotlight. Lenders will need to look very seriously to see if there is a market-led solution and consumers will also start to look at lenders for those.”
One of the options which has previously been proposed is discounts for environmentally friendly homes.
The mortgage industry has cautiously welcomed the Government proposals, saying they could encourage more first-time buyers into the market.
John Charcol senior technical director Ray Boulger says: “It will be good for first-time buyers purchasing new homes. It is encouraging but we do not know how feasible it is until we have the full details. It is disappointing that the structure of stamp duty has not been changed.”
Council of Mortgage Lenders head of policy Jackie Bennett says: “In theory, we welcome the stamp duty exemption but we will need to see the detail before we can assess the impact of this measure.”