With buildings in Australia accounting for nearly 25% of carbon emissions it is not surprising that buyers are looking to build more sustainable homes.

A 2020 CSIRO study found that more than 9 million homes in the country do not meet the 7 star Nationwide House Energy Rating Scheme (NatHERS) rating that deems a property sustainable. With only 10% of new homes built received a 7-star rating or higher.

Thus, with the target of building more 7-star energy rating homes, banks and lenders are now offering special green home loans to borrowers that are buying or building eco-friendly homes.

What is a Green Home Loan?

A green home loan is a type of loan that encourages borrowers to buy, build or renovate their homes in an environmentally friendly way. These loans offer discounted rates for homes that pass an eco-friendly threshold. In order to qualify for one of these loans, your future house should pass at least one of these qualifications:*

  • A 7 star or higher rating under NatHERS.
  • Sustainable property upgrades, this includes:
    • Installation of real-time energy monitoring systems.
    • Hot water pump or solar hot water system.
    • Upgrade to LED lights for at least 75% of all light fixtures.

*Specific qualifications will vary from lender to lender


Why should I get a green loan?

Green home loans befit borrowers that are environmentally cautious or those who want to play a role in building a sustainable future.

Some of the rewards of a green loan are:

  • Discounts on home loan interest rates
  •  Cash backs and rebates
  • Additional funding on sustainable home developments

Make sure to compare home loans and green loans to find the cheapest option for you.

What’s the difference between regular home loans and a green loan?

Green home loans are exclusive to homes that meet certain environmentally friendly benchmarks that’s described by the lender.

How Do I check if my house qualifies for a green home loan?

Each lender has different criteria for their green home loans. Our best advice for you to check the lender’s product information on their website.

Who Can I get a Green Loan from?

With the Clean Energy Finance Corporation (CEFC) committing over $120 million into funding green home loans, more lenders are starting to offer this product including:






Jamie Bonnefin

Written by Jamie Bonnefin

Jamie is the Director of Australia's leading ESD consultancy, Certified Energy. Jamie is a Green Star sustainability leader, NABERS assessor and accredited ABSA and BDAV Assessor. With over 15 years of experience in Sustainable Design in the built environment industry, Jamie is passionate about his work.