X
etsos

Free trial Sign-up

Please leave your name and email and we'll be in contact shortly.

Name

Company

Contact Number

Email

Please complete the sum:        
10 + 5 =

‘The Green Deal’ an opportunity or threat to Estate and Letting Agents?

14th January 2013

The Green Deal is due to kick off from 28th January 2013 and is the Governments flagship policy for cutting carbon emissions from buildings.

In essence it provides access to green finance allowing building owners to install energy efficiency improvement measures in their property. The repayments are made through the electricity bill with the unique aspect being that the loan sits with the property rather than person so any new occupier takes responsibility for the repayments. The ‘Golden Rule’ of The Green Deal is that the repayments should not be more than the estimated savings. So in summary outgoings should not go up, the property has been improved and when the loan is paid off the savings benefit the occupier. In concept a nice idea but in reality will it work? Only time will tell but if it does take off there are both opportunities and threats to consider for Estate and Letting Agents.

The opportunities come from revenue generation, forming partnerships with Green Deal Assessors, Providers or perhaps even becoming one. The ideal market for Green Deal finance are new purchasers who are looking to finance improvements outside of the mortgage and landlords who can improve their properties at no cost to them with the tenant  paying the bill. The motivation for landlords is increased further by new rules due to come into force by 2018 in which no property with an EPC rating lower than an E can be rented out. Estate and Lettings Agents clearly have the contacts to introduce the idea of Green Deal finance to and those working within the green deal will be happy to pay to get to them.

The threat comes from the finance being attached to the property. This means any prospective tenant or buyer is going to take over the repayments. So the Agent has to consider how then will this be explained? Will it affect the property value and will it be a potential stumbling block in the sale with purchasers expecting the balance to be paid before completion? The EPC will disclose whether Green Deal finance is secured on the property even if the vendor doesn’t but I suspect despite to golden rule this will be seen as a straight loan by purchasers that they either want nothing to do with or compensating in terms of purchase price to take on. This is made more relevant in that The golden rule is based on estimated savings and if not matched in reality the running cost of the property may be higher. Also occupiers struggling with cash flow can switch off to save energy, so reducing bills, whereas The Green Deal loan repayments remain a fixed cost. How it plays out in reality of course remains to be seen but The Green Deal is very much something that all agents should be ready to deal with.

For more information on The Green Deal please contact Ben Robinson at brobinson@etsos.co.uk

ETSOS uses state of the art technology to help property professionals save time, save money and increase revenue. Our outsourced ordering management portal and quotation and referral system are free to use and can help you reduce staff time as well as bring in new revenue streams.  For more information about how we can help you business please contact us on 01524 220013 or see our website www.etsos.co.uk

Subcribe for our industry news updates

 

Verification

The client and experts view...

  • thumb1
Latest newsspeech Bubble

AML Checks: Guide to Uploading the Passport.

The campaign against money laundering has seen the HMRC issue £2.5m of penalty notices since June 2017.

Making sure you’re compliant is vital.

When it comes to carrying out your checks, we supply AML reports as part of our Compliance in a Box service. (more…)

AML Fines for estate agents published

Estate agent anti-money laundering (AML) compliance is under scrutiny again following the publication of figures detailing the fines levied for AML non-compliance. (more…)

Price Increase Notifications – April 2019

We have received a number of notifications from our suppliers regarding their intention to increase prices from the new tax year at the start of April. As these are supplier increase we will unfortunately be passing the cost of the increase on to our customers. (more…)

5 days of FREE AML training

HMRC have revealed details about the fines it has levied on estate agents for AML non-compliance. To help estate agents stay the right side of regulation, Landmark are offering 5 days of FREE AML training for a limited time.  (more…)

Blog 3: Implementing your risk assessment

The Money Laundering Regulations require estate agents to risk assess their business relationships and apply an appropriate level of investigation to ensure that they understand who their customer is, and why they are involved in the transaction. (more…)

divider
newsletter sign-up

Sign up for our e-newsletter

Name
Company
Email Address
trialTop

trial sign-up

Click the Apply button opposite to use our software on a trial basis...

trialBottom
  • etsosnews

  • etsosnews

  • Linkedin Twitter Facebook
    This site uses cookies. Find out more about this site’s cookies.