The value of newly constructed homes is increasingly different from that of older residences in the Australian property market. Energy efficiency, maintenance costs, and shifting consumer tastes have all affected this development.

Quick summary

• Higher energy-efficiency performance is now required for new homes constructed in accordance with the National Construction Code (NCC 2022).
• WA adopted a minimum 7-star NatHERS requirement (Whole-of-Home) that went into effect on May 1, 2025.
• As a result, new homes are now much better than older stock in terms of thermal performance and airtightness.
• According to Domain’s 2025 analysis, energy-efficient properties in Perth sold for about 16.1% (≈AU$118k) more than their inefficient counterparts, indicating that energy-efficient homes attract a substantial price premium and better rental appeal. That significantly impacts decisions about investments.
• WA has one of Australia’s fastest-growing rates of rooftop solar and battery adoption; distributed solar significantly lowers operating costs and increases a property’s appeal to buyers and tenants.
• Payback timeframes for solar and electrification investments are impacted by federal wholesale cost drivers and state tariffs (such as Synergy adjustments), which continue to modify the economics of electricity.

An organised long-form guide with clear explanations, helpful retrofit checklists, investor-focused research, and ready-to-use messaging for listings that is specific to Perth and Bargoti Real Estate can be found below.

Why energy efficiency matters now (Perth market drivers)

1. The National Construction Code (NCC) established a minimum 6-star rating (out of 10) for new construction starting in 2010 under the Nationwide House Energy Rating Scheme (NatHERS), and it recently changed the requirement to a minimum 7-star rating.

2. These guidelines ensure that newly constructed homes are equipped with excellent insulation, effective heating and cooling systems, and measures to reduce mold and moisture while enhancing overall comfort.

3. A typical home built in 2010 or later receives a median star rating of 5.9 out of 10, whereas homes built earlier receive only 2.8 stars, according to CoreLogic’s December 2024 research, “Boosted up: How energy resilient are Australian homes?”

4. Perth’s property market — like much of Australia — is being reshaped by three converging forces:

• The baseline for newly built homes is raised by WA’s acceptance of NCC 2022 and minimum 7-star energy requirements for new builds (from May 1, 2025), making “new” synonymous with improved thermal performance by regulation rather than optional design.
• State-level tariff changes (e.g., Synergy revisions for WA consumers in 2025) modify homeowner economics and raise the value of efficiency and on-site generation; electricity prices and network costs are unstable.
• According to Domain’s 2025 Sustainability in Property study, buyers and tenants are becoming more ready to pay for energy-efficient homes; in Perth, this premium is typically around 16.1%, or AU$118,000. For developers and investors alike, that is a robust market signal.

5. Energy efficiency is now more than just a “nice to have” for Bargoti Real Estate; it serves as an asset-quality signal for investors and a value differentiator for listings.

6. Measurable results are achieved in inquiry and sales speed when NatHERS star ratings, solar capacity, and recent energy-related improvements are mentioned in marketing materials.

What “new” vs “old” homes mean technically

1. Older homes, particularly those built before 1990 and before 2000, usually display mixes of:

• Reduced degrees of insulation for floors, walls, and roofs
• Single-pane or ineffective double-glazed windows (or gapped timber sash windows)
• Poorer airtightness (draughts) and less regulated ventilation
• Older water heaters, incandescent/halogen lighting and inefficient HVAC systems (split or gas heaters)
• Wired for gas appliances and maybe lacking substantial electrical capability for heat pumps or EV charging

2. New homes (post-2025 NatHERS 7-star baseline in WA) are expected to include:

• Increased thermal insulation in walls, floors, and roofs
• Better U-values and orientation-appropriate shade are examples of improved glazing.
• Mechanical factors for improved airtightness and condensation control
• Heat pump hot water and reverse-cycle air conditioning are examples of specific appliances that can be electrified, while switchboards and rooflines are often solar-ready.
• NatHERS modelling for the entire home is used to show performance rather than individual components.

In practical terms, the fabric and services of modern homes lower heating and cooling loads, which account for the majority of household energy consumption in Perth’s Mediterranean climate (hot, dry summers; moderate winters).

Increasing demand for energy efficiency from investors and buyers

1. Investors and owner-occupants alike are increasingly willing to pay a “green premium” for more energy-efficient properties.

2. Energy-efficient homes sold for 14.5% more, while efficient condos sold for 11.7% more, according to a Domain analysis from May 2024. Price disparities reached 28% in certain places.

3. This readiness to spend more is a result of both the increased comfort provided by new constructions and long-term operating cost benefits.

Key policy & code changes affecting Perth (what to watch)

Significant, date-stamped changes to keep front-of-mind:

• With effect from May 1, 2025, WA instituted a minimum 7-star NatHERS and Whole-of-Home assessment requirements.  
• In WA, this modifies the baseline for newly permitted homes. NatHERS provides simulated star ratings (out of 10) that reflect thermal performance and anticipated heating and cooling energy consumption.
• Uptake and payback are affected by federal and state policies on rooftop solar and battery subsidies (as well as initiatives such as lower-cost home batteries).  
• Battery pairing and installations have grown significantly in WA. According to state and Clean Energy Council reports, rooftop solar is becoming a growing share of residential energy and generation.
• Throughout 2025, the AER and state utilities have adopted or announced pricing changes that impact customer electricity costs.  
• Midway through 2025, changes to standing offers and Synergy tariffs in WA changed the operating economics for both tenants and homeowners.

In addition to governmental incentives and tariff adjustments that increase the financial significance of both upfront and retrofit investments, new dwellings are constructed to stricter regulations.

Measured performance: what the data says

Two types of evidence are telling:

1. Price premium for energy-efficient housing

• According to Domain’s 2025 Sustainability in Property study, the average national price increase for energy-efficient homes is 14.5%, with Perth among the highest premiums at ~16.1% (AU$118k).  
• This suggests that consumers value improved comfort and reduced operating expenses.

2. Rooftop solar and output trends

• According to recent figures from the Clean Energy Council, rooftop solar now accounts for over 10% of Australia’s electricity supply.  
• The market for solar + battery pairing has been expanding quickly in WA.  
• Both buyers and tenants understand the value of these technologies’ ability to reduce net operating expenses.

“Old” houses differ greatly. A badly constructed “new” home that isn’t solar-ready or poorly oriented can be outperformed by a well-maintained brick home from the 1980s with retrofit insulation and a new heat pump. Both the fabric and the services affect performance.

The role of the National Construction Code (NCC) in driving change

1. The National Construction Code (NCC), which has gradually increased the emphasis on energy-efficiency requirements for newly built homes, is partly responsible for the notable disparity in energy efficiency between newer and older homes. In Australia, residential buildings account for almost 10% of all carbon emissions and 24% of all power demand.

2. Australia’s greenhouse gas reduction targets will continue to be supported by minimum energy efficiency standards for new construction, but established housing—where the majority of the country’s housing stock was built before the most recent minimum standards—will likely receive more attention and incentives.

3. The median star rating for houses built before 2010 across Australia’s major regions ranged from 2.3 in Hobart and Regional NT to 3.6 in Regional Victoria. On the other hand, the median star rating for homes constructed after 2010 was as high as 6.4 in Darwin and as low as 5.3 in Sydney and Regional NSW.

Median energy rating, major regions of Australia

1. NSW: With a median star rating of 5.2, Blacktown–North and Bringelly–Green Valley in Sydney had the highest scores for energy-efficient dwellings.

2. Victoria: Six of the nine regions in the nation with a median star rating of 5.8 are found in Victoria. The suburbs of Armstrong Creek, Curlewis, and Mount Duneed in regional Victoria’s Surf Coast-Bellarine Peninsula all have median star ratings of six or higher.

3. SA: Adelaide’s sub-areas, which included five regions, were similarly well-represented in the top 30 ranking as Melbourne’s. At 5.5, the Port Adelaide–East sub-region had the highest median star rating.

4. WA: With a median star rating of 5.8, Serpentine-Jarrahdale ranked highest in Perth, followed by Armadale and Kwinana with a median of 5.

5. NT: Palmerston has the highest median star rating (5.8) in Darwin.

6. Tasmania: Although Hobart has one of the highest median star ratings for newly constructed residences (6.3), sub-regions of Hobart were far lower on the list when all dwellings were analysed; the highest star rating for Hobart-North East was 2.6. A higher percentage of older dwelling stock, heritage regulations, and the need for heating due to the freezing temperatures could all be contributing factors to Hobart’s generally low star rating.

Economics: capex, operating savings, incentives, and payback models for Perth

A framework for comparing investment options (new build premium vs. retrofit spending on an older home) is provided below, with an emphasis on Perth.

• Upfront cost (capex) — new-build premium (land, construction premium for higher-spec) vs retrofit costs (insulation, glazing, HVAC, solar, batteries).
• Operating savings — reduced electricity (kWh) consumption, lower gas usage, reduced peak/controlled-load charges.
• Incentives & rebates — state and federal programs, builder incentives, and sometimes council grants. These vary over time — check current WA programs.
• Property value uplift — Domain shows a clear price premium for energy-efficient properties in Perth; include this in an investment horizon assessment.
• Payback period & IRR — depends on electricity price escalation, discount rate, occupant behaviour, and maintenance.

An example of a simplified payback (illustrative)

• Retrofit: AU$15,000–35,000 (depending on scope) for ceiling and wall insulation, draught sealing, LEDs, reverse-cycle air conditioning, and 6 kW solar
• Energy savings per year: AU$800–2,500 (based on solar exports, occupancy, and house size)
• Payback period: 6–20 years, depending on the situation. To reduce payback, add improvements to the entire house, such as a new hot-water heat pump. For exact figures, use any feed-in rate assumptions and local Synergy tariffs.

Yield and capital uplift (if buyers pay premiums for efficiency) can make retrofits appealing, particularly given Domain’s observed value premiums in Perth. For example, if a retrofit expenditure of AU$25k raises rent by AU$40–60/week and decreases overall vacancy.

Solar, batteries and electrification: how they change the picture

The percentage of rooftop PV and battery installations in WA has increased significantly; rooftop solar now accounts for a larger share of the country’s total electricity supply, enhancing household energy economics and resilience.

1. Why this matters for old vs new homes

• New homes are increasingly solar-ready (roof orientation, conduit to switchboard, space for panels).
• Retrofitting older homes with solar is often straightforward and can deliver rapid reductions to operating costs and improved rental appeal.
• Battery pairing helps capture self-consumption and reduces exposure to peak prices — necessary where feed-in tariffs are low and retail tariffs rise.

2. Electrification (heat pumps, etc.)

• Switching from gas water heaters and gas heating to heat pumps reduces greenhouse gas emissions and often reduces running costs (especially when paired with solar).
• Modern heat pump hot-water systems are much more efficient than older gas units.
• New homes under NatHERS are often designed with electrification in mind; older homes may need electrical service upgrades to support heat pumps, EV chargers and batteries.

Retrofit strategies for older homes — ordered by impact

Here is a list of the highest to moderate impact (cost vs. energy saved) for Perth portfolio managers using Bargoti:

1. High impact (moderate cost, considerable savings):

• Ceiling insulation upgrade — ceilings are a significant heat-gain/loss path. Upgrading to current R-values significantly reduces cooling loads.
• Draught sealing & airtightness interventions — gaps around windows, doors and services cause significant uncontrolled leaks; sealing reduces HVAC cycling.
• Reverse-cycle air conditioning upgrade (efficient inverter units) — modern systems use much less energy than older systems.
• Window shading & external awnings — for Perth summers, reducing solar heat gain on west- and east-facing glazing is very effective.

2. Medium impact:

• Wall insulation (where feasible) — cavity or retrofit external/internal insulation improves thermal mass performance.
• Hot-water heat-pump swap — replacing old electric or gas HW systems with heat pumps.
• LED lighting retrofit & efficient appliances — low cost, immediate savings.

3. Lower cost / supporting actions:

• Smart thermostats & behavioural nudges — small energy savings but reasonable tenant satisfaction.
• Solar PV installation (and battery, if budget allows) — costs vary; for many Perth homes, paybacks are attractive.

New-build design tactics that matter in Perth’s climate

Perth’s Mediterranean climate favours these design strategies (many now encoded in NatHERS modelling):

• Passive solar design
• High-performance glazing
• Thermal mass
• Ventilation & condensation management
• Roof orientation & PV-ready roofs

1. Orient living spaces to avoid low-angle summer sun on west glazing; use eaves to shade summer sun while allowing winter sun.

2. Choose glazing with a low solar heat gain coefficient for hot-exposed facades and an appropriate U-value.

3. Combine insulation with appropriate thermal mass (concrete slabs, masonry) in shaded zones to stabilise daily temperature swings.

4. Consider cross-ventilation, controlled trickle ventilation, and condensation measures (now required in NCC 2022).

5. Design roof pitches and clearances suitable for PV and future rooftop battery arrays.

Case studies & sample ROI calculations (illustrative)

1. Scenario A — Older 3-bed brick home in inner-Perth

• Retrofit package: ceiling insulation (AU$3k), draught sealing (AU$1k), 6.6 kW solar (AU$6k–8k after basic incentives), reverse-cycle split (AU$3k), hot-water heat pump (AU$3.5k) = Total AU$16.5k–18.5k.
• Expected annual energy bill reduction: AU$1,200–2,000 (depending on occupancy, Synergy tariff).
• Simple payback: ~9–15 years. But adding rental uplift of AU$30–60/week (AU$1,560–3,120/year) improves the effective ROI. Use current Synergy tariffs to refine.

2. Scenario B — New 7-star NatHERS duplex

• Higher upfront construction costs vs. the earlier NCC baseline — but lower operating costs and instant marketability.
• Given Domain’s premium signals, an investor might pay more up front but can expect stronger buyer interest and more stable rental yields.

Conclusion

In Perth’s evolving property landscape, the conversation around energy efficiency has shifted from optional to essential. With WA adopting the NCC 2022 energy standards and a minimum 7-star NatHERS requirement from May 2025, new homes are engineered to deliver lower running costs, superior comfort, and reduced environmental impact. Meanwhile, older homes still hold strong potential — with the right retrofits, insulation upgrades, and solar integrations, they can rival modern builds in performance and value.

For homeowners, investors, and landlords working with Bargoti Real Estate, understanding this balance between old and new homes is crucial. Energy-efficient properties not only attract higher resale values and stronger tenant demand but also provide resilience against rising utility costs. Whether building a new dwelling or upgrading an existing one, the key lies in combining innovative design, efficient systems, and sustainable energy sources.

Ultimately, the Perth market rewards efficiency — not just as a sustainability gesture, but as a sound financial decision. As more buyers seek homes that promise comfort, savings, and a smaller carbon footprint, energy efficiency has become the new measure of quality living. With the right strategy, every property — old or new — can become a high-performing, future-ready home.

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