Bond University and LJ Hooker Research
Tracking consumer sentiment on the importance of running costs when buying a home or investment property
Assoc Prof Stuart McAuliffe, Bond University, Faculty of Society and Design
The Residential Property Liveability Index will be valuable to home buyers, investors, developers and builders, real estate agents, energy companies and government regulators.
“The RPL Index is an indicator of consumer sentiment designed to measure and quantify the impact of sustainability on home buying and investment decisions. The RPL Index measures changing attitudes, intentions and expectations towards energy use, efficiency and future proofing residential housing. The RPL Index records responses to ten key questions to track change and make an assessment of potential economic, social and environmental changes impacting housing choices and adding a new factor influencing pricing and future growth of residential assets”
Regarding the development of the Index itself, we now have enough data to set a baseline at 100 for all components as of July 1st 2013 and can update the RPL index every 12 months to demonstrate changes in consumer expectations going forward.
However, the underlying data has provided a wealth of information that has significant value as measures into consumer intentions and can provide hard data contributing to the public debate on the importance of running costs of homes and efforts towards reduction.
Q2 2013-14 Results – our baseline
“The importance of the Liveability Index is to survey what home owners are actually doing and planning. We are assessing whether or not that changes over time and to what degree. For example, much has been done to encourage use of public transport however, consumers are reluctant to abandon their cars with any frequency, so policy makers may well struggle to achieve change and may need to work within realistic parameters. It also doesn’t appear that home owners want smaller homes. In fact, less then 3% are even considering down sizing and that is constant even as age increases and children have left home.”
Rate your Current Energy Costs
This is one of the most significant areas of the index research. There is little or no other research into the area (see link below), although a growing problem is emerging and a direct connection between affordability and energy prices is recognisable.
The data shows that 37% of respondents rated energy prices as either becoming a concern or currently ‘a real concern’. Expectations were for 8-15% to be in this category.
On the other end of the scale only 11% of respondents rated energy costs as ‘not an issue’. This clearly demonstrates that energy costs are a major and growing issue likely to be only solved by further regulation and ultimately technological breakthroughs. Therefore, it will be a key area of expertise for decades.
Rate your Efforts to Reduce Power
75% of respondents were making ‘reasonable’ or ‘significant’ efforts to reduce power. Notably a willingness to adopt power saving strategies is prevalent amongst all age groups services and not restricted to younger profiles often considered more focused on innovation and willingness to adopt new technology.
Importance of the Running Costs to owning home
Only 1% of respondents said that it was ‘not important’ to reduce power and over 50% ranked cutting power usage as ‘very important’, the highest category of response. This result is diametrically opposed to views that home-owners, investors and renters do not consider the running costs to be an important home feature. It is actually of prime concern as power prices have risen by double digits for close to a decade, even during periods of low overall inflation.
“The focus on and need for greater energy efficiency may favour developers building sustainable product. Our surveys show that energy concerns are also high for investors. Future proofing investments may become a more important feature and we are tracking this.”
The home is an important and central part of people’s lives and this is becoming more so. More work is being done from home. Also, more entertainment is being centred in the home. This potentially has implications for office space and retail as well.
Importance of Information about Reducing Running Costs
64% of respondents said they suffered from a lack of information. This underpins the importance of websites like Liveability to fill an identifiable need.
About Bond University
Bond University’s Faculty of Society & Design is dedicated to applying the latest theory, research and sustainable practices to its programs. Sustainable Development degrees are delivered in Australia’s first 6 Star Green Star – Education PILOT Building.
The Faculty of Society & Design offers high level degree programs that integrate all aspects of environmentally sustainable planning and design, with business, societal, economic, financial, legal and information technology considerations.
- Feature image credit to ©iStock.com/studio-fi