Public support for stricter energy efficiency laws threatens to see landlord costs skyrocket nationwide, a new study has warned.
More than 81 per cent of Aussies back Vicrotia’s planned energy-efficiency revisions for rental properties, with more than two-thirds wanting them rolled out in every state.
The proposals, set to come into effect next year, will force landlords to boost energy efficiency standards by installing ceiling insulation, improving door sealings, replacing hot water and heating systems and installing energy-efficient shower heads and minimum 3-star cooling systems in main living areas.
The scheduled changes are set to finalised next month and are designed to help the state reduce unnecessary energy expenditure while achieving its net-zero by 2050 carbon emission goals.
But most property investors will be hoping to avoid the changes, which would require those with rental properties or considering putting their home on the rental market to fork out thousands of dollars for multiple renovations in a short period.
The findings were taken from a survey of an independent panel of 1006 Australians commissioned by renewable energy provider Green.com.au.
Unsurprisingly, only a third of Victorian landlords favoured the changes, with two-thirds believing that other states should not follow the state’s lead.
However, Green.com.au CEO and co-founder David Green told Build-it landlords shouldn’t despair at the proposal, which he says will boost both the rentability and market value of their property.
‘Upgrades that improve the energy star rating of a property are likely to attract more buyers and renters, plus higher premiums,” he said.
“At the point of sale, properties with a 7-star rating are fetching as much as 9.4 per cent more, while rental properties with a five or 6-star rating get up to 3.6 per cent more in rent than a less energy efficient property.”
David told Build-it that most rental properties would only require some changes, with costs dependent on various factors.
“The cost of making the required changes will vary enormously and depend heavily on whether a property is in a metro or regional area, the availability of qualified tradespeople in those areas and whether a property owner is eligible for Government installation programs, rebates and subsidies.” he said.
While landlords may hope the changes don’t come to fruition, the study showed the younger generation was in full support, as well as current renters, with 91 per cent of all respondents under 35 supporting the change. Younger people are also the largest group of renters, with around half of those aged between 18 and 34 renting.
David told Build-it that the support of the younger generations showed Australia was trending towards a greater appreciation for policy changes that have a positive environmental impact.
“The overwhelming support for Victoria’s energy efficiency standards through our research highlights a clear mandate from Australians – especially among younger demographics – for stronger environmental policies,” he said.
“It is encouraging to see such strong support among the younger age groups because they are the people who will carry the changes we make now into the future.”
“Younger people have grown up with greater awareness of our impact on the environment and the need for change, and our findings reflect that.”
Regardless of if the changes get formal approval, David advises landlords to best prepare for similar changes sometime into the future.
“Our research sends a strong message to rental providers: adapting to these reforms is not just about compliance, but about aligning with the values of the next generation of renters who prioritise sustainability.
“For the Victorian Government and other governments considering similar reforms, these findings indicate broad public backing for expanding these standards nationwide. Implementing them can help Australia’s emissions goals and at the same time enhance property values and tenant satisfaction across the board.”
