Environmental impact of mortgage bond purchases: presentation of a possible estimation methodology

Abstract

This article presents a methodological framework for estimating the environmental impact of mortgage bond purchases. The model presented through the Mortgage bond purchase programme of the Magyar Nemzeti Bank (MNB), the Central Bank of Hungary builds on the changing composition of the Hungarian housing stock, and its main assumption is that, while maintaining the total floor area of the housing stock unchanged, financing residential property modernises the housing stock as a result of tightening building energy requirements, which reduces emissions. In our estimate, thanks to the MNB’s Mortgage bond purchase programme, the Hungarian building stock could reduce its CO2 emissions by 13-41 thousand tonnes per year. We have made several assumptions and simplifications in our calculations, and the results can only be evaluated in this context.