Green property dream: energy efficient homes attract 10% higher prices, new research finds
Love the sound of double glazed windows and solar panels on your roof? Whether you’re dreaming of a sustainable first home, or you’re itching to give your existing house a green facelift, there’s good news for you.
New research from the University of Wollongong’s Sustainable Buildings Research Centre has found homes with energy-saving features could be worth up to 10% more than homes without those features.
The study revealed that in the ACT, properties with a 7-star energy efficiency rating could fetch prices 9.4% higher than less energy efficient ones with 3 stars. Assuming a median house price of $773,635, that’s a huge $72,721 difference between the two types of homes!
Right now, the ACT is the only state or territory in Australia that requires sellers to disclose how energy efficient their homes are, based on the Nationwide House Energy Rating Scheme (NatHERS) under which all of Australia’s new residential buildings are assessed and given star ratings out of 10.
But it seems energy efficient properties are in demand across the whole country. Energy Consumers Australia’s Sentiment Survey last month showed that over half of Australian households in every state and territory were keen to see compulsory energy efficiency ratings for all houses on sale.
A green choice that keeps on giving
The popularity of energy efficient houses may come as no surprise. According to Mozo’s Director and Money Expert Kirsty Lamont, many Aussies are keen to make their homes more sustainable because of the benefits it reaps, such as lowering your energy expenses.
“Mozo’s summer energy habits report last year found that Australia’s addiction to air-conditioning eats almost $2 billion out of our budgets over summer. But living in a more energy efficient house could help to break that bad habit,” she said.
“Good insulation at home means you won’t be tempted to blast your AC or heater 24/7 and that could save you hundreds, if not thousands, of dollars a year, reducing the sting of your power bill.”
An environmental not-for-profit, Environment Victoria, estimated that Victorian residents would be able to cut down their electricity and gas bills by a whopping 40% with an energy efficient home. This means annual savings of up to $1,000 per household.
RELATED ARTICLE: Australians set to waste $2 billion on bad energy habits this summer
And the perks of a green renovation don’t stop there, with Lamont noting that "a reno can add value to your property and help you build the equity you have in your home - which means a larger portion of the property value belongs to you, rather than the lender.”
This means your renovation right now could save you even more down the track if you decide to refinance your home loan to a better deal. That’s because having more equity in your home can help you snatch up a more competitive rate, since you’d have a lower loan-to-value ratio (LVR) - jargon for the percentage of your property value you still owe to your lender - and therefore be seen as a lower risk borrower.
Eager to start your reno today? Then check out our green renovation tips for a more sustainable home. Or if you’re still in the early stages of finding a home loan for the green property of your dreams, make your first stop Mozo’s home loans comparison table!