Despite rising interest rates, more than twice as many loans for energy-saving renovations have been taken out compared to last year, L’Echo reported on Saturday. Driven by the surge in energy prices a record number of Belgian homeowners have decided that now is the time to make renovations that they expect to pay off even more quickly, given the high price of gas and electricity.
Renovating is a costly affair that most don't have the capital to front themselves. For this reason, Belgium's four major banks (BNP Paribas Fortis, Belfius, KBC and ING) recorded a major rise in loans granted this year – for ING this represents a +275% growth since 2018. The bank put this down to a realisation that the energy crisis will not be fixed in the near future, meaning green investments make more financial sense than ever.
“The energy crisis and its impact on bills mean that ecological renovation is now recognised as necessary and urgent by the majority of homeowners,” the bank analyses.
Subsidies and financing
Numerous premiums and regional subsidies exist to assist and encourage property owners to make renovations. In Flanders, interest-free loans of up to €60,000 can be taken out to pay for energy-saving renovations. In Brussels, €25,000 can be borrowed with fixed interest rates of no more than 1%.
Furthermore, a move to protect tenants from unreasonable rent indexations was implemented earlier this year. The measure prevents landlords from increasing rent if the leased property does not have a sufficiently high Energy Performance and Indoor Climate (EPB) certificate. Negotiations are underway to ensure that new-builds are constructed to a satisfactory energy grade. Those wishing to sell their property will soon have to ensure that it is of a defined energy performance.
Roof exhibited at renovations fair showcasing the benefit of efficient insulation. Credit: Belga/ BRUNO FAHY
In addition, instalment loans from banks make it possible to borrow smaller amounts to finance a project, by proceeding in stages without incurring file fees or notary fees. “More than half of energy loans granted are for installing solar or photovoltaic panels. 12% are for windows and double glazing, 12% for insulation and 12% for heating and/or boilers,” said BNP Paribas Fortis spokesman Valéry Halloy.
Panel and heat pump shortage
Demand for solar panels and heat pumps has already seen such a surge that supplies have been exhausted. Many components that are sourced overseas have become particularly scarce as supply chains have been disrupted by conflict and continued uncertainty relating back to the pandemic.
China – the world's biggest industrial supplier – has persisted until just recently with its zero-tolerance Covid policy, paralysing production factories and depriving many sectors of vital parts.
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Closer to home, supplies of primary materials have also been impacted causing prices of materials such as wood and insulation to increase hugely. Indeed, the cost of building a house has become €37,000 greater on average than last year, with many eager to start with home improvements sooner rather than later.
