Residential Mandatory Disclosure
NEWS: The Ministerial Council on Energy released the Regulatory Impact Statement (RIS) for Residential Mandatory Disclosure on 21 July 2011, detailing the options under consideration for implementing this legislation, and signaling the start of the public consultation process. Click here to view the MCE announcement, and here for the RIS document.
Energy Makeovers made a submission to the Residential Mandatory Disclosure consultation process outlining our support for a Level 1 assessment using a NatHERS-based tool for rating of dwellings, to enable an accurate rating of existing houses that is comparable with the NatHERS ratings required for new houses. Click here to view our submission paper.
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Mandatory disclosure of residential energy efficiency ratings
Home owners may soon have to reveal the energy efficiency or ‘environmental performance’ of their homes when they put them up for sale or lease, potentially affecting the value of millions of homes.
The Victorian Government, as part of a nation-wide process, is drafting the new disclosure rules for the benefit of potential buyers or tenants. The law, also known as ‘Environmental Performance Disclosure’, is expected to be introduced into Victoria in 2012 for the residential sector – this means that people selling or renting out houses may be required to show an energy efficiency rating performed by an accredited assessor. A similar scheme is already in effect for the commercial building sector.
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The state of Victoria
Currently, most of the existing homes in Victoria have an energy efficiency rating of less than 2½ stars (out of 10) – significantly lower than the 40,000 new homes built each year to a minimum standard of 5 stars. This shows that there is room for much improvement in existing homes that could allow them to compete better in the housing market and make them more comfortable to live in.
What are energy star ratings?
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How will this affect Victorians?
When mandatory disclosure begins in Victoria, people will be able to use the disclosed environmental performance to better compare different properties. A positive relationship between energy efficiency rating and house property value is expected to be seen. This could affect the value of millions of homes, and stimulate smarter design, construction and renovation of homes.
In fact, a study in the ACT, where mandatory disclosure has been in effect since 1999, found that good energy efficiency ratings led to high sale prices for properties. This can be particularly appealing as the cost involved in making an energy improvement may be significantly less than the increased capital value of the property resulting from the improvement.
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How can I prepare for Mandatory Disclosure?
With mandatory disclosure to be implemented in 2012, home owners can prepare by finding out their home’s energy performance. We offer a quick and affordable home energy rating service called EnergyStart, which will inform you of your home’s current rating as well as it’s potential energy rating that it could achieve with improvements.
Once you know how your home performs compared to others, you can improve your home’s energy rating, boost your property value and make your home more comfortable while paying less on energy bills. To ensure that you achieve the most cost-effective improvement to your home, we offer the Energy Makeovers Roadmap, which includes a comprehensive assessment of your home and energy usage and prioritised recommendations for energy efficient improvements.
To find out more about your home’s performance and book an assessment, please contact us.
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Further information
The Nationwide House Energy Rating Scheme label
Star Rating – A star rating is given as part of the Energy Efficiency Rating assessment of a building, it provides an indication of how efficient the building is, ranging from 0 to 10 stars (initially the range was to 6 stars) in 0.5 star increments. This is similar to the energy labelling of appliances , such as clothes dryers or refrigerators. A 0 star rating is very poor and means the building shell does practically nothing to reduce the discomfort of hot or cold weather. A 5 star rating indicates good, but not outstanding, thermal performance. People living in a 10 star home are unlikely to need any artificial cooling or heating. read more
ACT statistical study on the relationship between energy efficiency and property value – The study found that if the energy performance of a house improves by 1 star (out of 10), its market value will increase by about 1.5 per cent on average. For example, if a property owner installs R4 ceiling insulation at an approximate cost of AUD$1,200 they will improve the energy performance of a poorly insulated home by at least 1 star. This means that a detached house sold in 2005 for AUD$365,000 may fetch an additional AUD$5,500 with only a 1 star improvement in energy rating. read study report
Commercial Buildings – Since the second half of 2010 owners of commercial office buildings and government buildings with floorspace above 2,000 sqm are required to provide up-to-date energy efficiency information (including a NABERS energy rating) to interested buyers and tenants. read more
Increasing minimum energy star ratings for new houses – COAG’s National Strategy on Energy Efficiency also states that: “Minimum energy efficiency standards will be upgraded to 6-stars, or equivalent, nationally in the 2010 update of the BCA [Building Code of Australia].” More recently, in January 2010 the Minister for Innovation and Industry, Senator Kim Carr, and the Acting Minister for Environment, Senator Penny Wong, issued a joint statement confirming the changes to the BCA, stating that “the States and Territories have undertaken to implement the new residential standards no later than May 2011.” read more
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Sources:
Australian Government – Department of Climate Change and Energy Efficiency – Buildings > Homes > Existing Buildings
http://www.climatechange.gov.au/what-you-need-to-know/buildings/homes.aspx
Council of Australian Governments (COAG) – National Strategy on Energy Efficiency (2009) http://www.environment.gov.au/sustainability/energyefficiency/buildings/homes/index.html;
Australian Government Department of the Environment, Water, Heritage and the Arts (DEWHA) – Energy Efficiency Rating and House Price in the ACT (2008) http://www.nathers.gov.au/about/publications/pubs/eer-house-price-act.pdf