The most popular mortgage criteria searches in December were made by applicants in search of green and interest-only products, new data from Legal & General’s SmartrFit platform has indicated.
Searches for products that consider a property’s energy performance certificate (EPC) increased by 21% in December.
With many people in the UK facing high gas and electricity bills, L&G suggested that increasing numbers of homeowners are looking for more energy-efficient homes to help cut future costs and protect the environment.
Growing demand for eco-friendly homes was also reflected in Legal & General Capital’s research, conducted with YouGov, which found that buyers will pay up to 20% premium for low-carbon homes. This data shows that consumers are now rating energy-efficient, sustainable features as more important than the size of the property, when it comes to finding a new home.
At the same time, ongoing affordability constraints, and a sharp increase in rates in 2022, have seen more borrowers are opting for alternative solutions to maximise their borrowing potential. L&G’s SmartrFit data also revealed that December saw a 30% jump in criteria searches for interest-only mortgages as borrowers sought more flexibility in how they would like to repay their mortgage.
Furthermore, joint borrower-sole proprietor mortgages were the second most searched criteria point in December, indicating that more borrowers are leaning on income from family and friends to buy a property.
Head of mortgage products and transformation at L&G, Jodie White, said: “[Last year] certainly wasn’t without its challenges, but it is encouraging to see that, as customers’ needs changed in response to the surging cost of living and rising energy bills, the UK’s mortgage market was able to meet this demand with clear advice and innovative products.
“Affordability has naturally come under pressure in recent months, but our data shows that advisers are stepping up to meet this challenge and helping their customers find alternative solutions. This responsiveness is a positive sign for the health of our mortgage market.”
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