Improving the energy efficiency of a home could reduce its carbon footprint and help improve its sale value, according to Douglas Driscoll, CEO of award-winning real estate group Starr Partners.
Australia is the world’s largest carbon emitter per capita1 but Douglas believes that not enough is being done at the top level through policy and greater consumer awareness to reduce our carbon footprint.
“Most of our ‘green’ discussions are centred around creating energy in a more environmentally conscious manner, but we need to start looking at how we can improve energy waste by reducing the energy leaking from homes.”
According to the ABS, households are the biggest consumer of energy after manufacturing, even topping transport and mining2.
Douglas believes agents conducting valuations or appraisals on a house can give recommendations to vendors on how to be more energy efficient. This will not only help homeowners save money but it will also be a giant leap towards reducing our country’s carbon footprint. It could even improve the resale value of their home.
“There are 10 million dwellings in Australia and if each one is made five to 10 per cent more energy efficient, it will make a significant reduction on our country’s carbon footprint, and keep a lid on rising energy bills,” says Douglas.
Douglas shares his 4 recommendations for agents to discuss with vendors to ensure their home will get a great price.
1. Improve the energy rating
The Nationwide House Energy Rating Scheme (NatHERS) gives a star rating on the energy efficiency of a home. It uses a rating system out of ten to estimate the potential heating and cooling energy use of a home, based on design.
For homes built after 2006 a minimum NatHERS star rating of 5 has been required by The Building Code of Australia, and since 2010 a minimum rating of 6, though this varies across states and territories3.
According to research conducted in the ACT, improving the energy performance of a house by one star level, on average, increases the market value by about three per cent4. In an average market, homebuyers were prepared to pay up to $15,000 more for each additional star5. In most cases, the cost of upgrading a home could be less than the amount a buyer is willing to pay.
2. Renovation plans
Renovating a home to improve its energy efficiency could add value and future proof it as an investment. Well planned and executed home improvements can help a homeowner achieve their design goals without wasting money and valuable resources.
When undertaking major home renovations, there are minimum state and territory requirements homeowners need to meet based on the national construction code. In order to meet these requirements, a NatHERS-accredited assessor can conduct a home energy rating and provide advice on how to best design for efficiency and use a home to reduce its heating and cooling needs. Not only will this save homeowners money on energy bills but it could improve the resale value.
3. Practise energy efficient behaviour
Energy efficient behaviour can be just as important as energy saving technologies. Renewable energy such as solar and wind can be a great way to reduce a household’s carbon emissions. However, research has demonstrated it is only as effective as behaviour, with almost half of energy generated by solar lost when used in the home6 through a lack of insulation, single-glazed windows and cavities. Douglas likens this to pouring water into a bucket with holes in the bottom.
In order for vendors to get the best price for their home, they should make sure it is well insulated and even could consider installing double-glazed windows – not just for sound-proofing.
4. Government Rebates
Making a home greener and cleaner to improve its profitability is easier than a vendor may think. Government rebates are available to alleviate financial stress for homeowners looking to make their homes more energy efficient, according to Douglas. Your Energy Savings provides information for homeowners about government assistance to help them save energy and money.
3 Your home, 2013: http://www.yourhome.gov.au/you-begin/buying-existing-home
4 Department of the Environment, Water, Heritage and the Arts, 2008, found at: http://buildingrating.org/document/energy-efficiency-rating-and-house-price-act
6 Michigan State University, 2016: http://msutoday.msu.edu/news/2016/energy-saving-devices-work-if-you-use-them-correctly/