Should You Buy Before 7-Star Pricing Comes Into Play?
13th November 2023
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This article explores whether home buyers in Victoria should build before the 7-star energy rating and livable housing standards become mandatory in May 2024. It breaks down the pros, cons, and cost implications of waiting versus acting now, helping buyers make a more informed decision.
Should You Buy Before 7-Star Pricing Comes Into Play?
As of May 2024, Victoria will officially mandate the new 7-star energy rating and livable housing standards for all new homes. But if you’re considering building, the big question is: should you commit now or wait until these changes are fully in effect?
In this episode of the Home Building Hub Podcast, hosts Colin Bischof and Darren Brennan walk through what the 7-star regulation means, what changes are coming, and whether it's financially smarter to buy before or after these rules kick in.
What Is 7-Star Energy and Livable Housing?
7-star energy rating means:
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Enhanced insulation throughout the home
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Double-glazed windows
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Solar system requirements
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Smaller windows (to reduce heat loss and gain)
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Orientation-based design restrictions
Livable housing standards introduce:
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Wider hallways and doorways
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Flat garage slabs (no step-down)
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Step-free entrances
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Turning circles in bathrooms and toilets
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Provisions for handrails and accessible movement
These features aim to make homes more energy-efficient and accessible for all ages and mobility levels.
The Cons of Waiting Until 7-Star Pricing Hits
According to Colin and Darren, the most critical downsides include:
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Cost Increases: Builders estimate the upgrades could add $20,000 to $50,000 or more to a standard build.
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Design Limitations: Larger home designs (like 4-bedroom homes on small blocks) may no longer comply due to new spatial requirements.
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Land Orientation Challenges: Poor orientation could require extra upgrades to meet 7-star requirements, increasing build costs.
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Reduced Affordability: If you're already stretching your budget, these extra costs may price you out.
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Loss of Preferred Design: A delay might mean your dream floorplan won't fit under the new constraints.
The Pros of 7-Star Compliant Homes
While the added cost is real, so are the benefits:
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Energy Efficiency: Lower electricity and gas bills.
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Comfort: Homes remain cooler in summer and warmer in winter.
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Accessibility: Designed for all life stages – wheelchair accessible and elderly-friendly.
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Future-Proofing: Easier resale down the track, especially as energy standards become more important.
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Environmental Impact: Reduced reliance on fossil fuels through passive design and solar.
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Increased Property Value: A 7-star rating may help your home stand out to future buyers.
So, Should You Buy Now or Wait?
Both Colin and Darren agree that this is a personal decision, but if you are:
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Already approved for finance
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Clear on your preferred design and budget
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Ready to build soon
...then it could be smarter to sign a contract before the new regulations take effect.
Waiting might result in higher construction costs and reduced design flexibility. In contrast, building now means more choice and better use of your block size and orientation.
There may also be a pre-May 2024 rush, as seen in Queensland, so acting early (Feb or March) could avoid delays or builder capacity constraints.
Key Takeaways
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7-star and livable housing standards will be mandatory from May 2024 in Victoria.
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These changes will make homes more efficient and accessible but come with added construction costs.
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Waiting may mean giving up your ideal floorplan or spending significantly more.
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Acting now could save money and give you greater design flexibility.
FAQ
Q: What is a 7-star energy rating? A: It refers to a home's energy efficiency score under the NatHERS scheme. 7-star homes require less energy to heat or cool compared to older 6-star homes.
Q: Will all builders include these changes by default after May 2024? A: Yes, all new building contracts in Victoria from May 1, 2024, must comply with 7-star and livable housing requirements.
Q: Can I still build a 4-bedroom home on a small lot after May 2024? A: Possibly, but you may face limitations due to increased minimum dimensions and turning circles.
Glossary of Terms
NatHERS: Nationwide House Energy Rating Scheme used to assess home energy efficiency in Australia.
Orientation: The direction a home faces, which affects how sunlight and heat are managed.
Livable Housing Design: Building principles that improve accessibility and usability for people with limited mobility.
Turning Circle: The required amount of space in bathrooms and other areas to accommodate wheelchairs.
Listen to the Full Episode
Watch or listen to this episode here: Should you buy before 7-star pricing comes into play?
About the Home Building Hub Podcast
The Home Building Hub podcast, hosted by industry experts Colin Bischof and Darren Brennan, is Australia’s premier resource for new home buyers. With weekly episodes featuring special guests, the podcast provides objective, high-quality insights into the home building process—completely free and without sales pitches. From understanding financing options to navigating the complexities of building a new home, each episode is packed with actionable advice and tips.
Explore more episodes at http://www.homebuildinghub.com.au and join our growing community of informed home buyers.
Disclaimer
Whilst we’re all about providing value to you, this article should not be considered as legal or financial advice. It contains general information only and is based on the content discussed during the podcast episode. This information is relevant to the episode’s release date and may not be applicable at the time of reading. Always seek independent professional advice tailored to your personal situation before making any legal or financial decisions.