The lending aims to help registered providers of social housing reduce energy consumption and accelerate the decarbonisation of their housing stock. In line with NWF’s previous social housing retrofit investments, the loans will be used on eligible measures for retrofit, including the installation of energy efficient heating and lighting, insulation, renewable energy generation, ventilation and heating controls, as well as work on resilience measures and biodiversity.
The NWF will guarantee 80% of each retrofit loan originated by NatWest Group up to £500 million for a total commitment of up to £400 million. The guarantee commitment will help to enable private capital to be mobilised into the social housing sector at both scale and an attractive price, removing a significant barrier to the deployment of funds within the sector by increasing access to financing for registered providers of social housing.
Today’s announcement brings NWF’s total support for social housing retrofit to £1.3bn, following guarantees of £350m for Barclays UK Corporate Bank, £400m for Lloyds Banking Group and £150m for THFC. By enabling £1.65bn of lending through these guarantees, the NWF is ensuring that attractively priced financing is available to every aspect of the social housing market and caters to all needs. With close to 1,600 registered providers in the UK and an estimated £36bn of new investment needed to decarbonise housing association properties1, the sector requires significant investment to create warmer, greener homes fit for the future.
There are 4.5 million social homes in the UK with 2.9 million owned by private registered providers2. Of these homes in England and Wales, 28% have an EPC rating of D or worse and 10% do not meet the Decent Homes Standard3. The proposed loans aim to help accelerate retrofits and improve these figures.
NatWest Group brings significant expertise and market share in the social housing sector, with a strong regional presence across England, Scotland, Wales and Northern Ireland, enabling it to offer retrofit solutions to registered providers right across the UK. Support from the NWF has enabled NatWest Group to bring these fully unsecured mid-to-long duration loans to market, building on the Group’s green retrofit pilots, to roll out financing at scale.
Minister for Energy Consumers Miatta Fahnbulleh said:
As we continue at pace with the rollout of our Warm Homes Plan, this new agreement is another significant boost for delivering warmer homes and lower bills for social tenants. This follows our recent allocation of £1.8 billion to local authorities and social housing providers across England to deliver upgrades like insulation, solar panels and heat pumps, helping people save energy and money off their bills.
John Flint, National Wealth Fund CEO, said:
Everyone should be able to live in a warm home with affordable energy bills. However, the scale of the retrofit challenge facing the social housing sector is clear and significant investment is needed now to ensure that residents across the UK have homes fit for the future. The NWF has an important role to play in mobilising the private finance that will underpin this transformation. Our support for NatWest builds on our work with other lenders, leveraging their reach and expertise to ensure that as many registered providers as possible have access to attractive financing
Paul Thwaite, CEO of NatWest Group, said:
NatWest continues to be a leading lender to the UK social housing sector, and last month we upgraded our lending ambition to £7.5 billion as demand continues to grow. Working with the National Wealth Fund on deploying £500 million of new loans means we can help retrofit more social homes across the UK at pace – supporting those who need it most.
- ENDS-
Notes to Editors
The loans are available through NatWest, Royal Bank of Scotland and Ulster Bank on an unsecured basis and for terms up to 20 years.
1Sources: Decarbonising housing associations’ homes to cost £36bn, according to National Housing Federation
2Sources: Social landlords continue to build new homes, RSH statistics show - GOV.UK
3Sources: Annex tables for English Housing Survey 2023 to 2024 headline findings on housing quality and energy efficiency – GOV.UK
