Ecology Building Society is launching the UK's first dedicated mortgage for modular construction homes – could this be a pivotal moment for offsite construction?
Although initially aimed at the self-build and custom-build market, Ecology Building Society has partnered with several modular manufacturers to launch a new range of mortgages to support the growth of offsite manufacture across the homebuilding sector. Ecology's innovative approach secures lending on the modular panels before they arrive on-site ensuring mortgage finance is available for different types of self-builders.
The sustainable lenders 'offsite build' products enhance its range of green mortgages for self- and custom-build in a drive to encourage and accelerate the construction of the most energy efficient homes to help meet the UK's net-zero ambitions. The lender has initially teamed up with four modular manufacturers to offer the offsite build mortgages to their customers only. The Society expects to partner with more suppliers in the coming months.
Supporting offsite manufacture
The decision to introduce the new offsite build mortgages comes at a time when the Government is recognising the urgent need to reduce the carbon impact of house building and has stated that new homes must reduce carbon emissions by 75% by 2025. Supporting the role of offsite manufacturing and modern methods of construction to deliver greener homes was a key recommendation in Richard Bacon MP's independent review of custom and self-build housing. The Society hopes that the offsite build mortgages will improve the supply of mortgages and help to scale-up modular construction, which is recognised as a key part of the solution to address the housing crisis. Gareth Griffiths, Ecology's Chief Executive explained: "Decarbonising our homes is key to meeting our net-zero ambitions. Now, more than ever, it's important that lenders play an active role in incentivising green building and helping to reduce energy bills. We've been leading the way on sustainable mortgages for over 40 years, and we're really pleased to be working in partnership with offsite manufacturers, who have a track record of delivering sustainable homes. We hope that our new mortgages will help scale-up modern methods of construction to deliver more homes built to higher energy-efficiency standards.
"The introduction of the 'advanced payment' mortgage option is an exciting first for Ecology, making energy efficient offsite build homes more accessible for those borrowers who may require up-front funding. Our innovative approach, to secure our lending, in advance, on the modular panels while they are in the factory, has the potential to be a game-changer, helping to realise the environmental benefits of offsite construction, which will be critical in the fight against climate change."
Mortgage options
Ecology is offering borrowers a choice of two products, an arrears payment option and, for the first time, an advanced payment mortgage, which may be of particular interest to those who require upfront finance to fund the purchase of land and manufacture of the modular panels. On completion of the works, borrowers will also be eligible for one of the Society's C-Change discounts which are designed to incentivise and encourage borrowers to build their home to a better energy efficiency rating leading to a long-term saving in both energy and borrowing costs.
"People wanting better built energy efficient homes need a mortgage provider who can make buyers dreams become reality. Ecology have actually done something pioneering, genuine and intelligent in launching these new mortgages. Hopefully others will follow their lead. It's real change like this that is going to make a difference." Nick Fulford, Chief Executive, nHouse
On completion of the works, borrowers are eligible for a C-Change discount of up to 1.5% based on the SAP rating in the EPC (Energy Performance Certificate) or if the property is accredited to the exemplary AECB Building or Passivhaus standards. All of the offsite self-build projects must show they will achieve a minimum SAP rating of 88.
"The time is ripe for the housing industry to consider how we redefine sustainable and affordable living," says Craig White, Chief Executive, Agile Homes. "By adopting modern methods of construction in our panellised build system, made from naturally renewable materials, Agile can produce energy-efficient, carbon-capturing homes with minimal impact on the environment and significantly enhanced quality. The Agile team has the skills, industry experience, and methods to make this happen, on a significant scale, together with Ecology Building Society."
Alasdair Stephen, Architect and Managing Director, HebHomes said: "These new mortgage products reflect the changing construction sector with more and more homes manufactured offsite and assembled on-site. HebHomes are delighted to partner with the Ecology Building Society as we know these innovative new mortgages will allow more people to finance and build their dream homes."
For more information visit: www.ecology.co.uk/mortgages
MODULAR PROVIDERS
Agile Homes
Established in July 2019, Agile's latest project has helped homelessness charity, Emmaus Bristol, secure planning permission for 15 modular homes, with community space, to be built on the roof of Emmaus' Bristol office and retail store. For more information visit: https://agile.property
HebHomes
Founded in 2004, HebHomes is a leading architect-led kit home company and recognised as a pioneer in bringing sustainable, modern housing to rural Scotland and the wider UK. HebHomes together with its sister company Dualchas Architects, has developed five signature house ranges and 40 designs, re-imagined as modern and affordable living spaces. For more information visit: www.hebhomes.com
nHouse
Award winning nHouse offers self-builders and custom-build buyers a range of contemporary, spacious and energy efficient timber-framed homes. Using offsite methods means their homes are typically ready for buyers to move in 16 to 24 weeks after contract. For more information visit: www.the-nhouse.com
R. HOUSE
R.HOUSE is a collaboration between award-winning architects Rural Design and James MacQueen Builders on the Isle of Skye. This partnership means that they have the expertise of strength of design and construction, together, under one roof. For more information visit: www.ruralhouse.co.uk
Source: Offsite Magazine
