Progress on efficiency standards for rental homes

young woman in woolen plaid warm up hands over electric heater
Too many renters live in inefficient homes they can't afford to keep at a healthy and liveable temperature

Renew has been working with our One Million Homes Alliance partners in Victoria for several years calling for mandatory efficiency standards for rental homes.

Raising the efficiency performance of rental homes, which represent more than 1 in 3 of Victoria’s residential buildings, will substantially reduce the cost of living and health risks faced by tenants living in poor quality homes, and offer significant low-cost emission reduction opportunities.

While many landlords do the right thing by their tenants, we know from experience that most do not take advantage of efficiency programs even when they are free. For many, investing in efficiency measures like insulation or draught-sealing is just not a priority because they get no benefit – it’s the tenants who end up with the lower bills and better living conditions, while effective efficiency measures like insulation or draught-sealing are largely invisible and not perceived as adding asset value.

The only way to get the significant improvement we need is to require all rental homes to meet basic minimum standards for health, safety and efficiency before they can be legally leased.

We had a significant win in September 2018 with the passing of new rental laws creating the power to set standards. So we are now working closely with the Victorian government to define what’s in those standards and a timeline for implementation.

Drawing on the diverse policy and technical expertise of Alliance members, we have developed a model for successfully implementing rental standards in Victoria. Key to a successful rollout of rental standards is a staged approach that allows property owners to spread investment over several years, thus minimising upwards pressure on rents while ensuring adequate industry capacity to meet demand for goods and services.

As well as contributing to the Victorian process, we hope this thinking will also add value to the COAG Energy Council Trajectory for Low Energy Existing Buildings process which is underway during 2019. This work is developing a set of policy recommendations for improving the efficiency performance of Australia’s 9 million existing homes, with the option of mandatory rental standards prominent among them.

Read the short briefing paper and proposed implementation model