South Africa’s green housing gets $250m push from Standard Bank, IFC investment
Standard Bank enhances its green home loan portfolio with a $250 million IFC loan aimed at financing eco-friendly housing and reducing emissions in South Africa's property sector.
As the world continues to cut carbon emissions to net-zero by 2050, the International Finance Corporation (IFC) projects that transitioning to green construction could reduce global carbon emissions in construction value chains by 23% by 2035.
The buildings and construction sector is currently one of the largest emitters of greenhouse gases, accounting for a staggering 37% of global emissions.
To facilitate this reduction, Standard Bank – a leader in sustainable financing – has secured a $250 million loan from the IFC. This funding will drive green building developments and support green home loan customers.
“This is a great opportunity to unlock financing for green homes and green home development within the South African context. As leaders in the home loan space, we see it as part of fulfilling our commitment to addressing the challenges of climate change,” said Clive Spitz, Head of Climate Solutions at Standard Bank Personal and Private Banking.
Clive Spitz, Head of Climate Solutions at Standard Bank Personal and Private Banking
Clive Spitz, Head of Climate Solutions at Standard Bank Personal and Private Banking
This initiative is part of Standard Bank's commitment to sustainable development and the increasing demand for environmentally friendly housing. By offering customised financial solutions, the bank aims to make green homes more accessible and affordable for South Africans.
“Investing in eco-friendly or energy-efficient homes has tremendous opportunities for customers. It can enhance their quality of life and protect them from the instability in energy supply and the significant price increases we regularly see," Spitz added.
He further highlighted the unique benefits available to Standard Bank Home Loan customers purchasing properties in approved development projects certified by EDGE, a global green building standard.
"This provides an opportunity to utilise a blended financing tool. Through initiatives such as the IFC's Market Accelerator for Green Construction (MAGC) programme, we can unlock financing opportunities, allowing our customers to access incentives tailored for green developments,” he explained.
Key Benefits For Homeowners
Homeowners stand to gain several advantages:
- Access to Green Home Loans: Financing options now enable the purchase of homes built to global green construction standards, ensuring energy efficiency, water savings, and environmental sustainability.
- Cost Savings: Green homes typically offer reduced utility bills and a stable electricity supply, making them more cost-effective in the long term.
- Increased Property Value: Green-certified homes often have higher property values, representing a solid investment.
“This initiative opens the door for our customers to access Green Home Loans. Customers financing properties in approved EDGE-certified developments can receive a cashback of up to 1.5% of the bond amount and enjoy discounted home loan rates,” Spitz explained.
In addition to the environmental benefits, green real estate developments also provide an economic boost. According to the World Green Building Council, green buildings can reduce operational costs by up to 37%.
“These homes significantly impact the South African property market, offering resilience to rising energy costs and addressing climate risks. Moreover, this growing sector will stimulate job creation and economic activities,” Spitz noted.
Over the past two years, the bank's green home loans portfolio has grown substantially.
“Achieving a greener real estate sector is central to Standard Bank's sustainability goals. This initiative enables us to support both developers and consumers, aligning with our strategy of transitioning our mortgage book towards greener properties,” he concluded.
Visit Standard Bank to see if you qualify for a Green Home Loan.
Visit Standard Bank HERE to find out more about how they are supporting a Just Transition through their energy and infrastructure team.
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