Good news for the real estate market came recently from the Central Bank, which reported that the average weekly mortgage loan rate reached its lowest level in more than a year during the second week of October, at 4.56%.

However, access to financing remains one of the most difficult barriers for homebuyers to overcome: mortgage interest rates remain considerably above pre-pandemic levels and exceed the average of the past 15 years. In addition, financial institutions continue to impose stringent credit approval requirements.

In this context, there are some more attractive financing alternatives on the market today. Among them is one that -additionally- contributes to the care of the environment, the so-called "green mortgage loans.green mortgage loans".

The main attraction of this type of loan, when compared to a traditional mortgage, lies in the discount included in its interest rate, which ranges between one and three tenths of a percentage point approximately.

There are currently five financial institutions in Chile that offer this type of loan. Although each one of them has different requirements for the houses to qualify for this special loan, all of them require that they be new houses, in addition to accepting the Housing Energy Rating (CEV) as energy efficiency certification.

The CEV is an instrument implemented by the Ministry of Housing and Urban Development (Minvu) and the Ministry of Energy, which, through an evaluation by expert appraisers, rates the energy efficiency of a new home, considering heating, lighting and hot water requirements.

For the buyer, opting for a green mortgage loan offers other benefits in addition to the lower financing cost implied by the preferential interest rate, such as long-term savings on items such as energy bill payments and home maintenance.

In conclusion, this type of credit represents a double benefit: on the one hand, it facilitates access to sustainable housing, in a context of restricted financing; on the other, it encourages the acquisition of properties that meet high sustainability standards, in turn supporting the country in meeting its goal of carbon neutrality by 2050.

Thus, this financing solution not only helps buyers in a complex credit environment, but also drives more responsible construction and procurement practices, promoting a positive impact on the economy and the environment.

Sebastian Mahave

Real Estate Analyst, Fynsa AGF