Following the recent rise in UK energy bills, searches for mortgages that consider EPC ratings increased by 34% in July alone. Searches for mortgages for second homes also up by 17%. Overseas buyers continue to buoy the market, with searches on behalf of expatriates or EU citizens climbing by 25%.
6 Sep 2022
In July, searches for mortgages which consider a property’s EPC rating grew by 34%, according to new data from Legal & General’s SmartrCriteria tool. The news comes as UK gas and electricity prices continue to soar, causing widespread concern.
Elsewhere, brokers continue to see high demand from overseas buyers. To this end, searches for expatriates or EU citizens in the UK rocketed by 25% in July. This was mirrored by a 14% increase in searches for borrowers with foreign income.
As in June, most searches were also made on behalf of applicants with a visa. Searches for expatriates that aren’t based in the UK also rose by just under a fifth (17%).
Demand for niche products also remained high in July, with searches for buyers looking to purchase retirement properties and second homes climbing by 26% and 17% respectively. With Help to Buy drawing to a close in spring 2023, searches for those looking to purchase a home under the scheme rose by 18%.
The data also confirms that family members continue to play a crucial role in supporting first-time buyers. As such, ‘joint borrower sole proprietor’ was the sixth most popular criteria point in July.
Kevin Roberts, Director of Mortgage Services, Legal & General: “It’s reassuring to see the market retain its momentum despite wider economic pressure. In some areas, such as the overseas market, demand is even rising. This includes an increasing number of expatriates and EU citizens seeking UK mortgages.
“This month’s data also shows that some buyers are considering eco-friendly products and making greener choices. We are still very much in the early stages of the green revolution, but it seems safe to assume that rising energy bills have prompted more buyers to consider the financial benefits of opting for greener homes. While volumes remain low for now, brokers and lenders have a key part to play in raising awareness of green products and educating borrowers about EPCs, retrofitting, and other associated factors.”
Established in 1836, Legal & General is one of the UK's leading financial services groups and a major global investor, with over £1.2 trillion in total assets under management* of which 39% is international. We have a unique and highly synergistic business model, which continues to drive strong returns. Legal & General provides powerful asset origination and management capabilities directly to clients, which also underpin our leading retirement and protection solutions. We are a leading international player in Pension Risk Transfer, in UK and US life insurance, and in UK workplace pensions and retirement income. Our purpose is to improve the lives of our customers and create value for our shareholders. Through inclusive capitalism, we are investing in long-term assets, such as real estate and infrastructure, that can help build a better society for the future.
Legal & General Retail helps create brighter financial futures for all our customers. The division covers the savings, protection and retirement needs of our c.13 million retail policyholders and workplace members.
In 2022, we had total individual annuity sales of £954 million, and issued £632 million of Lifetime Mortgages and Retirement Interest Only Mortgages. Our Workplace pension platform served 4.9 million members, while our Protection businesses gave peace of mind to more than 6.3 million UK life insurance, 1.8 million group and 1.5 million US customers, taking in £3.1 billion of gross written premiums.
*at 31 Dec 2022