With the launch of a sustainability rating for apartments by the Green Building Council of Australia (GBCA), more Australians will soon have access to properties that meet these modern demands.

The new Green Star apartments rating independently verifies each apartment within a certified building, providing a trusted benchmark that helps buyers, renters, and financiers make more informed decisions.

According to GBCA CEO Davina Rooney, this system is designed to address housing affordability challenges, accommodate denser urban living, and respond to intensifying climate pressures.

“With housing affordability at crisis levels, our cities growing denser, and climate pressures intensifying, the demand for apartments must be met with cost-effective and sustainable solutions,” she says.

“The rating system we’re launching today will make it easier for developers to create generation-defining homes. It will help more Australians get their foot in the door in a way which not only saves them money – now and into the future – but also reduces our carbon footprint.”

Recent research underscores the critical role of green loans in this emerging sector.

A survey by Gateway Bank revealed that while Australian buyers prioritise pricing when considering a sustainable apartment, many remain unclear about eligibility, incentives, and the benefits available.

The findings showed that nearly 60% of respondents were attracted by discount pricing, about 35% valued recognition of the home’s sustainability, roughly 32% were interested in borrowing from an environmentally conscious institution, and a significant 87% indicated that an energy-efficient certification would influence their decision.

According to Rooney, although cost remains a key driver for buyers and renters, the growing importance of sustainability in purchasing decisions is clear, with 81% of buyers now regarding green features as either critical or important.

Despite a rise in lenders offering green loans for free-standing homes, there is a noticeable gap in financial products tailored for sustainable apartment loans.
Gateway Bank has already announced that it will accept the Green Star Buildings - Apartments Pathway certification as part of its Green Home Loan eligibility criteria, and other lenders are expected to follow.

According to Rooney, sustainable apartments should not carry an additional cost premium but instead become the standard. While a Green Star apartment might involve a slightly higher upfront cost - about 1.3%, or roughly $11,700 more to build - this extra investment is projected to be more than offset by long-term financial gains.

For instance, over a 30-year period, a Green Star apartment in Sydney could deliver nearly $111,000 in total benefits through reduced loan repayments, lower energy costs, and enhanced property appreciation.

Modelling for a $900,000 Sydney apartment with a $700,000 home loan suggests that home loan repayment savings alone could exceed $40,000 due to a modest discount, while energy savings could amount to more than $25,000 thanks to a 20–25% reduction in costs, and additional price appreciation might contribute an extra $45,000.

In the very first year, these advantages could total over $21,000, eventually compounding to nearly $111,000 over three decades.

Looking forward, Green Star apartments are expected to play a significant role in lowering carbon emissions, easing pressure on the energy grid, improving water efficiency, and enhancing home resilience with better insulation, natural ventilation, and protection against extreme weather.

Several industry leaders, including Cbus Property, Frasers Property, Homes Victoria, Lendlease, Sentinel, and Stockland, have already partnered with GBCA to trial the Green Star apartments initiative in their current projects.

These collaborations are showcasing how sustainable design can reduce running costs, boost comfort, and improve climate resilience for residents.

"We are proud to be part of this initiative because we know it will be game changer in helping more Australians access healthier, more liveable and more sustainable apartments,” says Adrian Pozzo, Chief Executive Officer of Cbus Property.

“As a first step we will be piloting the Green Star apartments pathway at our residential offering at 185 Wharf Street, Spring Hill, which will set a benchmark for sustainable apartment living while offering long-term cost savings for residents.”

This development, designed by Rothelowman, is currently under construction with completion expected in 2027.

Render: 185 Wharf Street, Spring Hill / Cbus Property

Clémence Carayol

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