This is a question often posed and rarely understood.

Points of difference such as quality solar passive design that improve liveability and technologies like solar PV panels that significantly reduce operational costs have been seen in many green rated buildings across the world. There is growing evidence supporting a price premium paid at point of sale and lease for these environmentally sustainable features.

Research indicates that there is both an increasing demand for ‘green’ high performing homes and a marketplace willing to pay 3% to 9% more, and in other research as much as 30% more.  Some of these insights and research findings can be found below.


Perth, WA, Australia (2016)

Psaros Sustainability Journey. IPSOS.

Source: Green Gurus™.

This sustainability sentiment survey has been primarily designed to understand the purchasing decisions of buyers for each building with questions focused on how sustainability Infrastructure (SI) impacted their decision. It also includes liveability questions related to perceptions of environmental, financial and social benefits.

11 Apartment buildings with 377 lots surveyed. High 33% response rate

Focus groups: Buyers (including landlords and owner occupiers), Tenants (control group).

Amongst other important buyer decision factors, the survey questions also asked:

1) To what level did Sustainability features influence the buyers purchasing decision;

2) What is the level of value held by buyers regarding sustainability infrastructure (i.e. do they believe it improves resale value);

3) What are the main features they value the most;

4) Do sustainability features in apartments rate high on a list of other competing features;

5) What level of influence do sustainability features have when trading-off against other comparable features (i.e. height of ceilings, communal gym, air-conditioning);

6) How high up the list is sustainability when considering traditional influencing factors (i.e. location/purchase price/ size, etc);


  • When asked directly if the buyer chose the apartment due to sustainability features a large 25% of respondents confirmed they did. To ensure a meaningful answer was given, the question was specifically posed asking if Sustainability Infrastructure (SI) was a primary decision making consideration after a number prior qualifying questions were posed. This is ground breaking and indicates a real and present appetite for these features. Importantly of this 25%, landlords more than owner-occupiers chose to buy the unit due to SI.
  • Green Initiatives rank high and sit on the top 5 attributes these buyers considered at point of sale. Although, affordability is main driver (a typical response).
  • When compared with other drivers (27 other influencing factors) in the buying decision (‘What mattered most’) in the buying decision – Owner occupiers (47%) ranked Green Initiatives the highest, with Landlords (37%) & Tenants (19%) lowest.
  • Costs savings regarded as the benefits of SI.
  • Impacts saleability – majority believe SI will improve the saleability & re-sale value.
  • More than half of respondents (58%) understand the full LCA impact a building has on the environment. 88% of respondents suggest knowing a developer has considered the full LC impact on enviro influenced their buying decision positively.
  • Majority will opt for 24/7 Cheaper Electricity rate but need to understand trade offs.


Perth, WA, Australia (2016)

Property Council, CCWA, Psaros. What Perth Wants.



New market research shows that Perth residents are ready to embrace change and development that will deliver a more sustainable, more affordable and more liveable city.

The research was commissioned by multi-residential property developer Psaros, working together with CCWA and the Property Council of Australia.

The main findings show that there is very strong support for more medium & higher density apartment-style developments around transport hubs (71% support) and in inner areas (68% support).

The top three priorities for Perth’s future are;

  • – an increase in public transport (train, light rail, buses) (95% support)
  • – more eco-friendly buildings that generate their own power, collect rainwater and use less energy (89% support)
  • – well-designed, safer bike paths to get to work and other places (86% support)

The majority of respondents (69%) do not consider low density living in detached single housing to be a more affordable option and of the 3 in 5 inner city residents who are likely to move house in the next 5 years; 73% would consider living in medium density housing and 50% in higher density housing.


VICTORIA, Australia (2014)

PRD NationWide


Overall, houses with green features had price tags that were $137,473 or 30 per cent higher on average than the median price, while units or apartments had average asking prices $43,532 or 11 per cent higher.

The research analysed houses and units advertised for sale and rent in Victoria over a six month period.

The study compared the asking price of 50 properties with similar numbers of bedrooms and bathrooms on the market in 41 suburbs and 50 units for rent in 39 suburbs.

PRD Nationwide national research manager Diaswati Mardiasmo said her study showed properties with green features generally commanded higher asking prices than the median price of their suburb.

“If you are thinking of adding value to your home through green features, you can’t really go wrong,” Dr Mardiasmo said. “There is an even spread of how much value a green feature can add to your home. Solar panels, solar hot water, water tanks and grey water systems all add approximately 29 to 33 per cent to house asking prices compared to the suburb’s median.”

However, sustainable features did not pay the same dividends in rental homes. Green houses only asked 4 per cent more for rent than the suburb median rent and there was no difference in the rent asked for units.

Lucas Real Estate managing director Glen Lucas said younger buyers in particular appreciated green features. “Buyers need to become more educated about green features because there are more benefits to having a green apartment,” he said.


ACT, Australia (2008)

Energy Efficiency Rating & House Price.



The ACT study found that if the energy performance of a house improved by 1 Star, its market value increased an average of 3% or $8,970. (DEWHA, 2008)

  • ACT implemented mandatory disclosure of Energy Rating (since 1999) on sale or lease!
  • 5000 homes analysed in this study (between 2005/2006)
  • Isolated star rating from all other variables (i.e location/age/size, etc)
  • FINDINGS: 1 STAR = 3% Value


Australia-wide (2011)

Building Better Returns


Using the National Australian Built Environment Rating Scheme (NABERS) energy and Green Star environmental rating schemes, this research project sought to empirically investigate the performance of green office buildings in Australia.

The study found:

  • A green premium in value for office buildings was evident for the NABERS energy rating. This saw the 5 star NABERS energy rating delivering a 9% green premium in value and the 3-4.5 star NABERS energy ratings delivering a 2-3% green premium in value.
  • The Green Star rating showed a green premium in value of 12%.
  • Evidence of major discounts in value and rent in the lower NABERS energy rating categories (less than 3 stars).
  • Green premiums (and discounts) in value and rent differed in specific office markets.
  • Green premiums were also evident in reduced vacancy, reduced outgoings, reduced incentives and reduced yields, particularly at the higher rated NABERS energy categories.
  • These office market green premiums in values and rents for Green Star and the top 5 star NABERS energy rating are generally comparable to that seen in recent US green office building studies (eg: Eichholtz et al, 2010b).

Overall, the results clearly highlight the added value of green office buildings in Australia, particularly at the higher levels of the NABERS energy ratings and Green Star.


California, US (2014)

Selling Homes with Solar – Value of Homes with Solar Generation Capacity.



A “green cachet” exists for PV homes; that is, buyers might be willing to pay a certain amount for having any size of PV system on their homes and then some increment more depending on the size of the system.

Appraisers, real estate agents, and other property valuers have made strides toward valuing PV homes, and several limited studies have suggested the presence of PV home premiums, but gaps existed in understanding these premiums for housing markets nationwide.

Largest-ever study quantifies the value of rooftop photovoltaics (PV)  on homes that sold across eight US states over 15 years.

500,000 homes in US now with solar PV on roof top (2014)

Home buyers consistently have been willing to pay more for a property with PV across a variety of states, housing and home types


California, US (2012)

The Value of Green Labels in the California Housing Market



Extensive research was undertake to find the value of green rated residential product. … analysis was conducted on pricing analysis of 1.6 million single family home sales in California between 2007 -2012, controlling for all other variables that typically influence selling  price such as location, size, age and amenities.

The average sales price for a non-certified Californian home was $400k.

Green certification raises the price more than $34,000 or 9%

Interestingly the sales premium is greater than the cost of the green features people are paying for and its is greater than resulting utility savings.

The most common green features are insulation, air sealing, weather stripping and efficient HVAC – none of which are expensive.

  • 1st rigorous large scale economic analysis of the value of green home labels in California
  • 6 million ‘single family’ home sales in California from 2007- 2012
  • Homes labeled with Energy Star, LEED or Greenpoint Rated (California’s label) sell for a premium of 9% compared to the average of similar homes.

“We used methodologies beyond the typical appraisal scope, taking into account the energy efficiency benefits as well as factors such as healthier indoor air quality and sealing air leaks  which improves the durability and effective life of a home. We ultimately determined that the many benefits of green homes do lead to higher home values in the local market.” Debra Little, appraiser.   (Source:


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