​The Green Finance Institute (GFI) aims to establish Property Linked Finance (PLF) in the UK. 

Property-Linked Finance (PLF) could enable more homeowners to make energy improvements to their homes by linking finance to the property rather than. There are many benefits to this, including accelerating the adoption of heat pumps and installation of insulation by removing the upfront cost barrier.  

Utilising PLF would mean that when the home is sold, the debt transfers across to the new homeowner. This is particularly useful for energy improvements to homes, as homeowners often don’t see significant cost savings for several years. In real terms, this means that a homeowner could invest in improvements but not see the savings within the time they own the property.  

Any new homeowner will benefit from the improvements through lower bills and so can continue to pay off the debt whilst seeing an overall saving. There is also growing evidence that energy efficient, low carbon buildings can generate a premium when being sold. The GFI began the process to instate PLF in the UK, which required co-ordinated collaboration across the finance, legal, retrofit and property sectors, as well as local, devolved and central governments.​  

The GFI established a partnership with two high street banks in June 2023 and designed a prototype model for PLF, developing a ‘greenprint’ (as opposed to ‘blueprint’). While refining the product design, the GFI are looking for opportunities to pilot a minimum viable product, with a view to launching a transaction in 2024. 

This project has created a strongly conducive environment for the development of Property Linked Finance in the UK. GFI’s greenprint will underpin and support further design within the finance and retrofit sectors. This alongside a developed thought-piece will serve to raise the profile of PLF as a viable solution for decarbonising UK buildings.