Green is gold: Energy-efficient homes selling for 14.5% more nationally
Energy-efficient homes have been fetching premium prices nationwide as buyers have turned to green energy and environmentally friendly dwellings, a new Domain report revealed.
Properties with eco-friendly features have yielded significant returns, with energy-efficient (EE) homes selling for $118,000 more (14.5 per cent) than non-EE properties nationwide, according to Domain’s 2025 Sustainability in Property report.
Domain’s chief of research and economics, Dr Nicola Powell, said these premium prices are linked to changing buyer behaviours, as more Australians are prioritising homes that offer lower energy bills, year-round comfort, and a lighter environmental footprint.
“Energy-efficient homes are no longer an ethical choice – they’re a smart financial choice, particularly given rising energy prices and mounting cost-of-living pressures,” Powell said.
Domain’s research showed that energy-efficient homes are selling for higher prices in every capital city, with EE houses selling for 11 per cent higher ($100,000 more) than their non-EE counterparts across the combined capital city markets.
However, the price premium size was found to vary from city to city.
The greatest disparity was found in Melbourne, where EE houses sold for 23.8 per cent higher ($197,000 more) compared to non-EE houses, followed by Perth, where EE houses sold 16.1 per cent higher ($118,000 more).
“Compared to Sydney or Canberra, these cities offer relatively more affordable housing, giving buyers greater flexibility to pay a premium for EE features,” Powell said.
“In both markets, newer housing stock – particularly in outer suburbs or infill developments – also provides more opportunities for developers to incorporate energy-efficient design and technology as a competitive differentiator in the market,” she added.
Specifically in the Melbourne market, Powell said that the state’s more subdued market over the recent years has given buyers more choice and enabled them to be more selective and prioritise sustainability when purchasing a home.
Energy-efficient houses in Brisbane sold for 14.1 per cent higher ($120,000 more) compared to non-EE properties, while houses in Sydney and Adelaide fetched prices that were 12.3 per cent ($180,500 more) and 12.1 per cent ($97,500) higher, respectively.
Despite recent greenfield housing estates on Brisbane, Sydney and Adelaide fringes, which are increasingly being built to the seven-star Nationwide House Energy Rating Scheme (NatHERS), Powell said that price premiums remain in the mid-range nationally.
Price premiums for energy-efficient homes in Hobart, with houses selling for 10.8 per cent higher ($78,000 more).
Darwin recorded the smallest price difference across the capital cities, with EE houses selling for 7.8 per cent higher ($53,000 more).
“With smaller transaction volumes and a housing stock that largely predates current efficiency standards, these markets offer fewer highly rated dwellings and face less competitive pressure to upgrade,” Powell said.
Although the price difference between energy-efficient and non-EE homes in Canberra registered at 10.8 per cent ($94,000 more), Domain’s data showed that 72.1 per cent of houses in Canberra are energy-efficient, which is markedly higher than the 63.1 per cent in runner-up Adelaide.
Powell said Canberra’s forefront position for energy-efficient homes across the nation was linked to the ACT’s policy of mandatory energy-efficiency ratings, which was enacted in 1999.
“This is largely due to the ACT’s longstanding mandatory energy efficiency disclosure scheme, which requires the inclusion of an Energy Efficiency Rating (ERR) in all residential property sales and rental advertisements,” she said.
On the other end of the spectrum, Powell noted that Sydney was home to the nation’s lowest proportion of energy-efficient houses (40.5 per cent).
According to Powell, Sydney’s low housing affordability and challenges across jurisdictions still hinder energy-efficient homes from becoming more accessible.
“High property prices may force buyers to compromise on EE features to stay within budget. Local climate variation, household income levels, and government incentives (such as solar rebates) also influence supply,” she said.
Powell said that energy efficiency is no longer optional, but instead becoming ‘essential’ to competitively position a property in the market across the nation.
“Demand is strong across all price points, and the rewards are tangible. Homes with energy-saving features not only command higher sale prices but also attract more buyer interest and deliver greater comfort for everyday living,” she concluded.