Homeowners are racing to install ‘green upgrades’ in an effort to boost the value of their property, but are they worth the hefty price tags?
New research from CommBank has revealed that seven out of 10 homeowners are rapidly adopting ‘green upgrades’ like increased insulation, solar panels, and highly efficient water fixtures to boost their homes’ price tag.
Of those homeowners who hadn’t yet upgraded, 80 per cent said they were planning to in the next 12 months.
And according to the University of Melbourne, homeowners might be right. After examining 42,000 house sales in the ACT from 2011 to 2016, researchers found homes with higher star ratings commanded higher prices on the market.
Five and six-star homes were worth two per cent and 2.4 per cent more than one-star homes, and homes with seven stars were worth an extra 9.4 per cent.
For the average $912,700 Aussie home, that two per cent boost could mean an additional $18,254 to your property’s value.
Dr Georgia Warren-Myers, who co-authored the study, said it shows home buyers value energy efficiency and that it’s a factor people consider when buying a home.
“Energy efficient features are moving from a nice to have to an essential for many Australians,” said CommBanks Executive General Manager Home Buying Michael Baumann.
“Research results show that 75 per cent of Australians believe energy efficient features are a must-have in their homes.
An expensive investment
However, Mr Baumann said that while homeowners had an “increasing appetite” for energy efficiency upgrades, many struggled to afford the often costly upgrades.
“Now more than ever, homeowners are faced with affordability challenges and the research identified cost as a barrier to making energy-efficient upgrades,” he said in a statement provided to Build-it.
“Buying and installing clean energy products is an investment and making meaningful upgrades to your home can require a significant upfront financial commitment,” Mr Baumann said.
In CommBanks’ latest poll, six out of 10 respondents said the cost of energy-efficient solutions was preventing them from upgrading their homes.
Australia’s most popular home upgrade, solar panels, can set homeowners back anywhere between $2,900 and $14,100, depending on the solar system size, location, brand, and quality.
The research also revealed that nine in 10 Aussies weren’t aware if their bank offered a low-interest loan or discounted loan to help them cover the upfront costs of making home energy efficiency upgrades.
According to Mr Baumann, green loans and financial products are available to help Australians with upfront costs in making their home more sustainable and energy efficient.
“Buying and installing clean energy products is an investment and making meaningful upgrades to your home can require a significant upfront financial commitment,” said Baumann.
“However, there are specific financial products that can help Australians with those upfront costs to allow them to put their plans into action.”
Commbank has reportedly expanded its green loan from $20,000 to $30,000 to help eligible homeowners install several green upgrades.
“With no establishment fee, monthly loan service fee, or early repayment fee and a low, 10-year secured fixed rate, the CommBank Green Loan can help homeowners improve their home’s energy efficiency,” said Baumann.
“The CommBank Green Loan now covers the purchase and installation of products such as heat pump hot water systems, electric vehicle charging stations, switching from gas to electric cooking appliances and double-glazed windows.”
