Starting 1 March 2027 | Victoria, Australia
The Victorian Government is introducing major changes to minimum energy efficiency standards for rental properties. These reforms are designed to improve comfort, reduce energy costs for renters, and support the transition to more sustainable homes.
As a rental provider, it’s important to understand what’s changing and when, so you can plan ahead and stay compliant.
Key Dates and Requirements
From 1 March 2027
- When heating and hot water systems reach end of life:
They must be replaced with energy-efficient electric systems (such as reverse-cycle heating or electric heat pumps). - At the start of a new rental agreement or when switching to periodic:
- Cooling: A fixed, energy-efficient cooling system must be installed in the main living area.
- Ceiling Insulation: Where no insulation exists, ceiling insulation with an R-value of 5.0 must be installed.
- Shower Heads: All shower heads must be upgraded to 4-star WELS-rated models.
From 1 July 2027
- At the start of a new rental agreement or when switching to periodic:
- Draughtproofing: External doors, windows, and wall vents must be sealed to prevent drafts and heat loss.
From 1 July 2030
- Applies to all rental agreements (new and existing):
- Cooling: An energy-efficient fixed cooling system must be installed in the main living area – no exceptions.
Exemptions
Exemptions apply where it would be considered unreasonable to meet the standard, such as due to structural, heritage, or planning restrictions. The specific criteria are detailed in the regulations.
Financial Support Available
Rental providers may be eligible for rebates and incentives through the Victorian Energy Upgrades (VEU) Program, which can help reduce the cost of upgrading insulation, hot water systems, and energy-efficient cooling.
How Inner Real Estate Can Help
At Inner Real Estate, we’re here to support our landlords in navigating these changes. We can assist with:
- Property assessments to identify upgrade requirements
- Access to licensed and trusted trades for compliant installation
- Coordination of works to minimise disruption to tenancies
- Guidance on available rebates and help with applications
- Ongoing compliance tracking to keep you ahead of the deadlines
Next Steps
Start planning now to avoid the rush and take advantage of support programs. Whether you own a single investment or manage multiple properties, early action will ensure a smooth transition and protect your rental income.
To arrange a property compliance review or speak to our team about next steps, contact your Inner Real Estate property manager today.