The Domain Sustainability in Property 2025 report is a data-rich look at the value of energy-efficient homes in Australia. It shows, in no uncertain terms, that buyers are not just interested in sustainability—they are actively paying a significant premium for it.
For years, I’ve been worried that professional valuers in New Zealand might not properly account for the superior performance of a certified Passive House building. The argument has always been a bit of a chicken-and-egg situation: valuers claim they base their numbers on what the market is willing to pay, but with so few Passive House certified homes hitting the market, there’s no clear sales data to prove the premium. It’s a frustrating loop that has held back a lot of good projects, mostly speculative development. There’s only one case I can point to in New Zealand: Passive House certification, among other non-standard features, added 12% to the valuation.
The Australian report shows houses with energy-efficient features sell for 15% more than their not energy-efficient counterparts, which translates to a median dollar difference of A$118,000. For units, the premium is 12%, or A$75,000. Not loose change! Even on projects that pivot to Passive House performance late in the design, the extra costs don’t reach those sorts of percentages.
The report debunks the tired old myth that energy efficiency is a luxury reserved for the wealthy. It turns out that middle-income households are a key driver of demand for these homes, motivated by long-term cost savings and environmental concerns. This directly contradicts the idea that people on average incomes aren’t focused on their energy bills.
I’m frustrated that we don’t have a report this thorough for New Zealand. We’re left to extrapolate from Australian trends. However, the influence of policy is undeniable. The Australian Capital Territory (ACT), with its mandatory energy-efficiency disclosure at the point of sale, shows the highest proportion of homes marketed with energy-efficient features. It’s a clear case study for what happens when you build market transparency: when buyers have the information, they make smarter choices, and the market responds.
Fundamentally, if we want to make the Passive House standard mainstream, getting the valuation right is critical. It’s the key that unlocks bank financing and gives builders and homeowners the confidence to invest in quality. This Australian report provides a powerful precedent. It shows that when you have a critical mass of better buildings and transparent data, the market doesn’t just see the value—it pays for it.
Abstract
Domain Sustainability in Property Report 2025
This report analyses property listings and sales data from across Australia to quantify the value of energy-efficient homes. It finds that homes marketed with energy-efficient features command a significant price premium, attract more buyer interest, and are becoming increasingly mainstream.
Key findings include:
- Houses with energy-efficient features sold for a median premium of 15% (A$118,000), while units sold for 12% (A$75,000) more.
- Energy-efficient houses attract 14% more online views from potential buyers than houses without energy efficient features.
- In 2025, over half of Australian houses (52%) sold were marketed with energy-efficient features.
- Demand is strong among middle-income households, challenging the perception that sustainability is solely for affluent buyers.
- Regional areas show even stronger price premiums for energy-efficient homes than capital cities.
Reference
Sustainability in Property 2025: Demand, supply and affordability of energy-efficient homes. Domain Group, 2025.