Canberra renters in worst properties in the market, according to new report

More than four in every 10 Canberra rental properties have the lowest-possible energy efficiency rating (EER) of zero, according to a new report released by Better Renting on Thursday.

The report is based on an analysis that compared the advertised EER of rental properties listed in January and February this year and showed 43 per cent had a rating of zero.

Better Renting director Joel Dignam said Canberra renters are “being left to suffer in the worst properties on the market”.

“This report shows that almost half of renters are living in glorified tents that virtually do nothing to keep inhabitants safe and comfortable throughout summer and winter. This means higher power bills, worse health and avoidable climate pollution,” he said.

Properties in the ACT are given an energy efficiency rating between one and six based on the running costs of homes in terms of energy output, such as heating and cooling. Homes with a higher EER are more cost and energy efficient.

Homes with an EER of zero cost almost four times as much to run per year.

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It is a requirement for ACT properties to provide the EER when listing a home for sale or rent.

Only 15 per cent of properties advertised for rent had an EER of six.

While 43 per cent of rental properties had a rating of zero, only 4 per cent of homes for sale had an EER of zero and 39 per cent had an EER of 6.

The report states: “Rental properties are typically less energy efficient than owner-occupied properties because of the ‘split incentive problem’… there is little incentive for owners of rental properties to invest when tenants reap the benefits from improved energy performance.”

Mr Dignam said the analysis shows the need for government action on the issue.

“The ACT government needs to introduce minimum energy efficiency standards to rental properties to address this problem,” he said.

“Queensland has updated its Residential Tenancies Act to allow minimum energy efficiency standards, and New Zealand requires landlords to install ceiling insulation, but in the ACT, renters are being left out on the cold.

“It’s clear landlords are not acting themselves to make rental properties energy efficient.”

A spokesman from the ACT Environment, Planning and Sustainable Development Directorate said the report provides an “interesting snapshot”.

“The sample in the report isn’t necessarily representative of all the rented buildings in the ACT, but provides an interesting snapshot of some properties advertised for sale and rent over January and February this year,” they said.

The spokesman said the government is committed to investigating regulatory and non-regulatory ways to improve the energy efficiency of rental properties.

“Improving the energy efficiency of residential rental properties in the ACT could improve their comfort and liveability.

“However, introducing minimum energy efficiency standards for rental properties may result in increased rents if an owner passed on those costs of upgrades … we need to make sure that any option doesn’t put affordable, higher-efficiency dwellings out of reach of those who would most benefit from them.”

The report comes after Domain’s State of the Market showed Canberra’s median weekly asking rent is the second-highest in the country in both units and houses.