Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Solutions. Read the original article for full details.

Santander Adjusts Mortgage Affordability for Octopus Zero Bills Homes

Santander UK has become the first major high street bank to change its mortgage affordability calculations for buyers of Octopus Energy’s Zero Bills homes. Under a new partnership, Santander will exclude household energy bills from affordability assessments for customers purchasing homes built to the Zero Bills standard.

Octopus Energy’s Zero Bills tariff, launched in 2022, applies to new-build homes equipped with a heat pump, battery storage, and solar panels. The tariff guarantees residents will pay nothing for home energy for at least 5-10 years.

Santander stated that the absence of home energy bills could mean buyers have more disposable income to allocate towards mortgage repayments. According to the bank, buyers of a five-bedroom Zero Bills home could potentially borrow up to £30,000 more than under its standard affordability assessment, depending on the mortgage term. Illustrative figures from Santander show possible borrowing increases ranging from around £10,900 for a one-bedroom property on a 25-year term to nearly £30,000 for a five-plus-bedroom home on a 40-year term.

Santander’s announcement also referenced its Tomorrow’s Homes report, based on a February 2026 survey of nearly 2,000 UK adults conducted by Ipsos. The research found that just over half of adults believe improving their home’s energy efficiency would make a meaningful difference to their lives. Eight in ten cited reducing energy bills as their main motivation for home improvements, while about half wanted a more comfortable home. However, more than half of respondents said the upfront cost of energy-efficiency upgrades was a barrier to making changes.

Santander said that adjusting its mortgage assessment for new-build Zero Bills homes, rather than requiring buyers to retrofit existing properties, could help address the cost barrier for those purchasing these energy-efficient homes.

This development may be relevant for letting agents and inventory clerks working with new-build, energy-efficient properties, as it could affect affordability assessments and borrowing potential for prospective buyers.