One in five homeowners cannot finance the necessary renovation of their own home themselves. That will be revealed on Tuesday an analysis by De Nederlandsche Bank (DNB) of 4.3 million homeowners. About 21 percent of current homeowners cannot afford to make them more sustainable themselves because they have too little savings or too little borrowing space from the bank.
This jeopardizes the ambitions of the government, which wants all buildings to become climate neutral in the long run. It was agreed in the 2019 climate agreement that one and a half million homes will no longer use natural gas in eight years.
Young people and young adults are overrepresented among the homeowners who cannot afford the sustainability measures. As well as homeowners in shrinking regions, especially in North Friesland, North and East Groningen and East Drenthe.
These often ‘financially vulnerable’ people relatively often have poorly insulated houses, DNB writes, with a low energy label. With their high consumption costs, they would benefit greatly from sustainability. Especially now that energy costs are rising so quickly.
Also read:Eating or heating: Life has become unaffordable for millions of Britons
But the government is unable to reach them with existing schemes and subsidies. DNB notes that these mainly end up among the middle and high incomes. “For the lower income groups, the schemes are considerably less effective.”
The central bank therefore advises to think about new forms of subsidy. Although that will not be easy, because the group that cannot afford sustainability is not easily defined.
DNB therefore recommends considering whether investments can be made in specific regions, such as the shrinking regions, where these problems are greatest. Regional authorities can help with this.
For part of the group, this is a temporary financing problem, the central bank writes. It is ‘conceivable’ that young homeowners will see their income rise, so that they ‘in the longer term will be able to finance the sustainability investment’.
Few financial incentives
The DNB study shows that making an owner-occupied home free of natural gas costs an average of 24,000 euros. This amount varies greatly by region and type of housing.
DNB also finds bottlenecks for those who can pay for that investment with savings. According to the central bank, about half of the owners have enough money to make their own home natural gas-free and then have a buffer of 5,000 euros left for unforeseen expenses. Even 68 percent have enough savings for just insulating their own house.
Also read: An energy-efficient house smells different, says the house whisperer
But there is little enthusiasm among them for such large investments, according to a survey that DNB had carried out. Less than one in five owners is willing to invest at least 12,500 euros in sustainability.
DNB expects that these homeowners ‘still experience the business case as insufficiently positive’. It is therefore up to the cabinet, DNB writes, to make such investments ‘financially more attractive’.
A version of this article also appeared in NRC on the morning of February 9, 2022