As Australia enters the hot, muggy summer months, many are beginning to feel the warmth — and realising their homes aren’t great at keeping them cool.
New analysis from CoreLogic shows that the typical home built in 2010 or later is twice as energy-efficient as homes built before then.
Historically, Australian homes have fallen short in terms of proper insulation for our varied and often extreme climate.
Roughly 80 per cent of homes have energy efficiency ratings of two stars or less out of 10.
Here’s the average energy efficiency rating across the country and a breakdown of the best-performing areas.
What is the minimum energy efficiency standard in Australia?
Australian homes are rated between zero and 10 stars, depending on their energy efficiency.
A zero-star home is too hot in summer, too cold in winter and requires excessive energy to heat and cool. A rating at the lower end of the spectrum is often compared to living in a tent.
CoreLogic’s report found homes built after 2010 achieved an estimated median star rating of 5.9 out of 10.
This is compared to a median of just 2.8 stars for homes built prior to 2010.
CoreLogic research director Tim Lawless said outer suburbs had higher median ratings than those in the inner city because they had more houses built since 2011, when the National Construction Code (NCC) was introduced, and with it a minimum NatHERS rating of six stars.
Energy Efficiency Council senior adviser Rachael Wilkinson agrees.
“These days, the majority of new homes in Australia require a star rating of six or above,” Ms Wilkinson said.
“But back in the mid-2000s, before star ratings were mandated, the average home was widely believed to be below two stars.
“For newer residential developments in city fringes, this means more homes built to higher standards of energy performance.”
New builds across most of the country are now required to meet a minimum seven-star efficiency rating, up from the previous six-star benchmark.
Speaking to ABC North Queensland reporter Lily Nothling earlier this year, Canberra sustainable building expert Jenny Edwards said the new standards represented a “significant jump” in energy efficiency and comfort.
“A seven-star house requires 30 per cent less energy per square metre to heat and cool across the year … [which] equates to hundreds of dollars in savings,” Ms Edwards said.
Ms Wilkinson says the NCC’s new guidelines in improving the quality of our homes “directly impacts our health, wellbeing, and hip pockets when it comes to energy costs”.
ACT leads the nation
The region of Molonglo in the ACT nabbed the top spot as the nation’s most energy-efficient area, with the highest median star rating at 6.1
It was the only region nationally to achieve a star rating of six or higher across all dwellings.
The report noted that Molonglo is the newest housing district in the ACT, with the “predominance of newly built homes adding to the higher median star rating”.
The only capital cities that were absent from the top 30 table were Sydney and Hobart.
Sydney’s Blacktown North and Bringelly-Green Valley missed the cut by only a few basis points.
Both areas recorded a median star rating of 5.2.
Tom Coad, CoreLogic head of banking, product and solutions, says a lower number of newer properties in locations like Hobart contributed to its absence in the top 30.
“The sub-regions of Hobart were well down the list based on the analysis of all houses, with the highest star rating recorded at 2.6 across Hobart-North East,” Mr Coad said.
“This relatively low rating across the regions could be attributed to a larger portion of older housing stock, heritage restrictions and the heating demand for such a cold climate.”
The ratings were decided using CSIRO’s RapidRate AI model, which considers the type of property, the floor area, the amount of wall and window space, which direction the house or townhouse faces, insulation and the materials used to construct the building.
Low energy ratings detrimental to sellers
Real Estate Institute of Australia (REIA) president Leanne Pilkington says energy star ratings are a key indicator for the buying and selling public.
“A low energy efficiency rating can indicate higher ongoing utility costs and potential expenses for upgrades, which may deter buyers or lead them to favour other properties,” Ms Pilkington said.
In 2025, New South Wales will trial disclosing energy rating information at the point of sale or lease.
Once it becomes noted in the contract, Ms Pilkington says people will start using it as leverage to negotiate on price.
“Buyers might leverage a lower rating to negotiate a reduced price, citing the cost of future upgrades to improve energy efficiency.
“Conversely, homes with high energy star ratings may command a premium because they promise lower running costs and a smaller carbon footprint.”
How can I make my home more energy efficient?
According to the Climate Council, a 7-star home uses 18-28 per cent less energy to heat and cool compared to a 6-star home.
This equates to a rough saving of $900 per year.
Managing a home’s energy performance can be challenging due to factors like financial barriers and split incentives between landlords and tenants.
Fortunately, there are options for improvements at every budget, such as:
- Installing or replacing old ceiling insulation
- Door snakes and sealing strips can block draughts from doors and window frames. These are available at your local hardware store
- Installing double glazing or window films
- Updating your hot water system
- Covering holes in walls where old appliances were
- Opening and closing blinds against the heat and cold as windows are a major source of heat gain and loss in a house
- Setting your air conditioner at 24 degrees during summer. The Energy Efficiency Council says this is the “optimum temperature”
Ms Wilkinson says improving a one-star home to a four-star rating saves more energy than upgrading a four-star home to a seven-star rating.
“This demonstrates that energy efficiency upgrades are most valuable when applied to homes with lower ratings as they offer the largest potential for improvement.”
