Page 2572 - Week 07 - Wednesday, 1 August 2018
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they go to later resell the property, disappear with no explanation. Often that equates to a loss in value.
That was well covered in an article on 17 June this year in which a University of Melbourne study examined 100,000 property sales between 2011 and 2016 in the ACT and found that in some instances buyers were willing to pay up to 10 per cent more if a property had a higher energy efficiency rating. The analysis found that homes with a five-star rating, out of a possible 10 came with a two per cent premium, while those with six stars often attracted a premium of 2.4 per cent. However, there was a much higher price paid for homes, which would be new homes, that had a seven-star rating. They had a 9.4 per cent premium. I suggest that members read into that with a bit of caution. There have been rapid increases in property values in the ACT during that period of time as well.
The issue here, though, is that when purchasers are making this decision based on purely an energy efficiency rating or a number, they should have a confidence in the scheme that that equates to something tangible. A desktop audit or a desktop measurement, which is done on new homes, does not always relate to the audit or the calculation that is done on an established property. Likewise, on established properties the assessments are not as rigorous as they are on a new home. It is very difficult for an assessor to look in a wall, see that there is insulation in there and know whether it is an R-rating of one, two, three or four for the insulation in the wall. So typically the calculation is a tick-box exercise. Does it have installation—yes or no? It does not really take into great consideration the quality of that insulation.
There has been other commentary around the lack of action by the government to address a number of these issues that have long existed in the scheme. As Ms Le Couteur has rightly said, she was raising them back in 2008. I would suggest, from a brief stint working in the real estate sector, that the issues existed back to almost as early as the turn of this century.
There also remain issues around the skill level and the qualifications that exist in the territory to conduct these reports. Often a lot of reliance is placed on the calculators. But a lack of training sometimes exists. A recent desktop audit that the government conducted between July 2016 and June 2017 randomly ordered 616 separate energy efficiency ratings and discovered a combined total of 1,264 non-compliance instances. That is an average of more than two issues per rating. It is worth also noting that that rating was a desktop rating; they did not go out and re-measure or reassess the properties. Most of those areas were in administrative decisions and not actually in the ratings scheme itself. But the underlying issue here is that there are a multitude of calculators that can be used. There are a number of issues with the way that those calculators are being applied. It is hard for a consumer to draw a correlation between the rating on one property when it is new and the rating when that property is later sold, perhaps two years later.
There is also a significant concern that Ms Le Couteur touched on which, as someone who comes from the building industry, is something that I have a lot of concern around. That is things like double glazing. Not all doubled-glazed windows are created equally. Some are very expensive while some are quite economical, but they
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