Opportunities and obstacles of private financing in the renovation of national residential buildings

Bankos Borító

Our research explores the financing opportunities and barriers to energy efficiency renovation in residential buildings. On the basis of interviews with banks and real estate agents in Hungary, we investigated what obstacles might open up the possibility of expanding essential bank financing to increase renovation investments, if these obstacles are removed.

Our research explores the financing opportunities, incentives and barriers for residential building energy renovation. Energy renovation of buildings is one of the sectors with high potential for energy savings and GHG emission reductions, but at the same time the sector faces a significant investment gap. The financing of energy renovation will be largely private, with a smaller share coming from public (budget, EU) sources, the latter mainly catalysing private investment.

In our previous study, we have already examined good practices in the field of private financing of energy renovation, mainly from abroad. In our current research, we have explored what, if the barriers are removed, could open the way for the necessary private financing to become stronger, which could encourage banks to expand financing and property owners to increase the volume of energy-efficient building renovation investments.

The novelty of the analysis lies in the information provided by senior executives from private financial operators, who however often stressed the importance of public involvement. To write the study, we conducted 11 interviews with relevant organisations between January and March 2024, following preliminary research and organisation, and summarised lessons learned and common points of view. Interviews were conducted with the heads of the four largest commercial banks (OTP, MBH, Erste, K&H), mainly sustainability managers, the Banking Association, the Hungarian National Bank, the Hungarian Development Bank, Garantiqa Loan Guarantee Ltd. and the three largest real estate brokers (ingatlan.com, Otthon Centrum, Duna House), mainly managers responsible for valuation and energy certificates.

Our recommendations will be communicated to decision-makers and the study will also serve as a discussion starter for our building renovation conference on 9 October 2024.

The report in Hungarian:

A magánfinanszírozás lehetőségei és akadályai a hazai lakóépületek felújításában


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