Treasury-owned NWF on track to provide a total £1bn in retrofit loan guarantees over next six months
The National Wealth Fund (NWF) has confirmed £150m in financial support to help registered providers (RPs) retrofit their social housing stock in the UK.
The funds will help The Housing Finance Corporation (THFC), an affordable housing aggregator, to make “long-term, unsecured loans to RPs at pricing usually reserved for secure lending.”
This partnership is the first time that the NWF, which operates independently but is wholly owned by HM Treasury, has provided guarantees for social housing retrofit to bond market investors.
The initial £150m investment will be given to THFC by Rothesay, the UK’s largest specialist pensions insurer.
THFC and the NWF said it aims to grow this figure to £250m over the next six months. This would bring the NWF’s total commitment to retrofit loan guarantees to £1bn after it confirmed £750m in financial guarantees to Barclays and Lloyds Banking Group. The banks announced plans to make £1bn in loans available to social landlords for retrofit projects in October 2024.
Rachel Reeves, chancellor of the exchequer, said: “Growth to get more money in people’s pockets is my number one priority.
”This new partnership will unlock £150m in private investment and create further jobs, building on the 6,500 jobs already expected in the retrofit sector across the UK, so more people can get sustainable, high-quality, energy efficient social housing.
>> See also: Thirteen Group secures £30m loan from Natwest for retrofit programme
“The National Wealth Fund is mobilising billions of pounds of investment in our world-leading industries, creating jobs and kickstarting economic growth, as we deliver on the country’s priorities in our Plan for Change.”
Retrofit loans will be used to install low carbon heating, insulation, low carbon lighting, renewable energy, ventilation and heating controls in existing social homes, as well as measure resilience and contribute to biodiversity.
Currently 34% of socially rented properties in England have an Energy Performance Certificate (EPC) rating below C, with social housing representing almost 15% of all homes in fuel poverty in the UK, according to the NWF.
It is estimated by the National Housing Federation (NHF) that around £36bn of investment will be needed to fully decarbonise housing association properties.
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