GREEN Global Real Estate Engagement Network’s Post

Check out this article on 'How investing in green buildings, including cheaper home loans, is a win for banks, people and our planet' then head to our website to dive into our new Design Guide on Resilient Timber Homes. This Guide describes how sustainable timber homes can be designed and built with a resilience-focused Code+ approach, leveraging the combination of factors that make them the natural answer to the challenges from our changing climate and provide safety and wellness to their occupants. https://bit.ly/4f05fdA

#Hollis Director Steve Hughes features in Arc & Co.’s recent Summer Real Estate Lending report!📈📊 Steve reflects on successes and learnings from H1 and predicts what's next in real estate for H2. He also delves into new ESG requirements and offers practical guidance on what clients should be aiming to achieve. Read more for the full piece: https://lnkd.in/e7tqRXBQ #RealEstate #Report #ESG #Lending

When a key property's NABERS Indoor Environment rating dropped, it threatened a major Australian real estate company's sustainability goals and financial incentives tied to their sustainability linked loans. How did they turn it around? 👉 Discover the full story here: https://i.cim.io/3XPeuFV #Sustainability #NABERS #RealEstate

Great insight. Upgrading is crucial to meeting net zero. But the questions of how to fund it, especially for individual landlords (eg over shops etc), how to avoid hikes in rent to pay for it over a short period, lack of more and better retrofit products on the market and how to deal with older buildings with Grade 1, 2 restrictions, inability of leaseholders to control costs imposed by freeholders and hence plan upgrade investment, etc all still hang very much in the air. This will all need careful thought on policy, finance, timescale, all avoided by the last government. We also need to remember the impact on the market and confidence of still unresolved cladding and associated debts, impact on borrowing tax treatment and ability to sell. Let's not forget that the cladding crisis arose from hasty action on insulation, deregulation, poor quality build and corruption. Cladding outside high buildings was just the simplest, quickest solution, but badly done. We must ensure that never happens again. On new build, the issues are well-known in comparison, the industry had been gearing up before ditching of Zero Carbon Homes, and there are no real excuses for delaying so long on net zero.

A critically important step for sustainability in property. This raises the possibility of legally stranded buildings and will lead to valuation impacts for many others. These are factors all lenders will need to consider as refinance risk increases.

Single-Family Rental Investment Trends Report Q2 2024 The Q2 2024 Single-Family Rental (SFR) Investment Trends Report by Arbor and Chandan Economics underscores the sector's robust growth and resilience despite broader economic challenges. Here’s a summary of the key insights from the report: Key Highlights: Record Construction Starts: SFR and build-to-rent (BTR) construction starts reached record highs, driven by increasing demand. CMBS Issuance Surge: Commercial Mortgage-Backed Securities (CMBS) issuance for SFR rose to $1.9 billion in Q1 2024, the highest quarterly total since mid-2022. Cap Rates Increase: The SFR sector saw cap rates rise to 6.6%, influenced by high interest rates and strong rent growth. Stable Occupancy Rates: Occupancy rates remained robust, averaging 94.7% in Q1 2024, indicating sustained tenant demand. National Rent Growth: SFR rents increased by 5.0% year-over-year, demonstrating the sector's ability to maintain strong rental income growth. Rising Debt Yields: Debt yields increased to 10.9%, reflecting lenders' cautious approach in the current economic climate. Valuation Trends: The average valuation for SFR properties with Fannie Mae mortgages saw a decline, indicating investor caution amidst market uncertainties. Market Stability: Despite high mortgage rates, there was little to no distress in the housing market, showcasing the sector's resilience. Performance Metrics: CMBS Issuance and Origination: The increase in CMBS issuance was primarily driven by new acquisition loans, highlighting the continued investment interest in SFR properties. Debt Yields and Lending Practices: Lenders remained diligent, maintaining high debt yields to mitigate risks in the lending environment. Outlook: The long-term outlook for the SFR sector remains optimistic, supported by strong market fundamentals and increasing demand from a diverse renter base. The sector is expected to continue its growth trajectory, driven by favorable demographic trends and sustained investor interest. #arbor #chandaneconomics #sfr #singlefamilyrentals #housing #economy #cmbs #btr #affordability

🔍 Exploring Upcoming Changes in the UK Property Market: What’s on the Horizon? 🏘️ As we navigate the evolving landscape of the UK property market, staying informed about upcoming laws and potential changes is crucial for professionals in the industry. Here are some forecasted developments that could significantly impact property development and investment: 1. Environmental Regulations: With the UK’s commitment to achieving net-zero carbon emissions by 2050, we can expect stricter environmental regulations aimed at enhancing energy efficiency in new builds. This may include: Increased energy performance standards: New builds may need to meet higher energy efficiency ratings, which could involve the use of renewable energy sources, better insulation, and energy-efficient appliances. Mandatory sustainability assessments: Developers may be required to conduct comprehensive environmental impact assessments to identify and mitigate potential effects on local ecosystems. 2. Leasehold Reforms: The government is actively reviewing the leasehold system to make it more supportive for homeowners. Anticipated changes could include: Abolishing ground rents: Proposals suggest phasing out ground rents altogether, allowing homeowners to pay a 'fairer' price for their properties. Right to Manage: Homeowners may gain more straightforward pathways to take control of their properties through a "Right to Manage" provision. This change would empower leaseholders to manage their buildings without needing to prove fault on the part of the current management. 3. Planning Permission Revisions: Efforts to streamline the planning permission process are underway to address the pressing housing shortage. Key aspects to watch for include: Digitalisation of planning applications: The government may introduce more efficient digital platforms (finally) for submitting and reviewing planning applications, reducing turnaround times. Fast-tracking for sustainable developments: Projects that prioritise sustainability and community benefit could be fast-tracked through the planning process, encouraging developers to adopt eco-friendly practices. 4. Financial Regulations for Investors: Changes in financial regulations are expected to affect property investors, potentially including: Stricter lending criteria: Lenders may implement more stringent assessments for mortgage applications, focusing on income stability and creditworthiness, which could impact buyers' purchasing power. Increased focus on risk assessments: Investors might need to provide comprehensive risk assessments for their projects, demonstrating financial viability and potential returns to secure funding. What changes are you anticipating in the property sector? Share your insights below! #UKPropertyMarket #RegulatoryChanges #Sustainability #LeaseholdReforms #PlanningPermission #PropertyDevelopment #StructuralWarranties

NEW REPORT: GREEN REAL ESTATE FINANCIAL MARKET REPORT 2024 Co-authored by our colleague Sarah Sinclair Five themes emerged as part of this research: 1) While the current green real estate landscape remains fragmented, featuring diverse green metrics, frameworks, and debt products, there is a notable trend towards greater standardisation and global alignment. 2) We observe a shift in policy focus from a property-specific energy efficiency metric to a total emissions focus, including embodied emissions from construction. This shift is evident both in policy literature and voluntary green finance frameworks. 3) Similarly, the targets for deep green performance are moving from low-carbon to carbon neutral and even further to carbon-positive. 4) Climate change adaptation is becoming increasingly relevant to the real estate sector as property assets face physical risks such as floods, hurricanes and fires due to a changing climate. The assessment of physical risks in real estate has significant implications for financing, insurance, and asset values. 5) The discussion in the real estate sector relating to green finance is shifting from the ‘greenium’ to ‘brown discounts’, emphasising the advantages of green financing instruments, including lower default rates. #economics #property #greenfinance #realestate #research https://lnkd.in/gziSj2YN

Thank you Discover Financial Services for this detailed breakdown of green loans and the benefits of green home improvement projects. It is great to learn how these financing options can help the environment and your wallet.    #DiscoverEmployee #Budget #Finance #Tips #Environment #Sustainability 

Thank you Discover Financial Services for this detailed breakdown of green loans and the benefits of green home improvement projects. It is great to learn how these financing options can help the environment and your wallet.    #DiscoverEmployee #Budget #Finance #Tips #Environment #Sustainability