On Tuesday, the UK Government proposed legislation that would enable homeowners to take out loans worth thousands of pounds in order to meet its ambitious environmental targets. Under the legislation, homeowners would take out loans against their homes to install cavity wall insulation, loft insulation. or solar panels.
As any such loan would be fixed against the home itself rather than the individual who took it out, if a homeowner moves out of the house he or she would not be liable to repay the outstanding balance; indeed, the loan would continue to be affixed to the house, so any new owner would inherit its annual charge.
Although the requirement for a person who was not party to the original credit agreement to continue repayments on it is likely to prompt much discussion in the legal sphere, the question of whether or not it will have any impact on the future housing market remains to be seen; in fact, it would probably only be a good thing, as new homeowners could enjoy savings on domestic energy bills as a direct result of increased efficiency through insulation and an alternative clean power source in solar energy.
The issue of domestic energy bills in the context of the Government’s carbon emission targets is becoming a cause for concern across the country. Although most people are not opposed to environmentally friendly measures, the majority of households are becoming increasingly conscious of their domestic energy bills in light of the economic downturn and recent cold weather.
Following news that the major energy suppliers in the UK are posting record profits without passing wholesale fuel savings on to consumers, many households are concerned that fuel bills will endure rise after rise throughout the coming decade. It is expected that around 60% of the estimated £18.6 billion cost of the Government’s green energy measures will be passed on to consumers through the major energy suppliers. The latest green legislation proposed by the Government plans to use finance from retailers such as B&Q and banks such as the Co-op in order to provide the loans to homeowners, which may be available from 2012 onwards.