New loans to switch on solar for rentals
State government’s latest solar initiative is a win-win for renters and landlords.
Renters and their landlords both stand to benefit from the state government’s new interest-free loans for landlords to install solar panels on rental properties.
Eligible landlords can apply for an interest-free loan of up to $1850, which comes on top of an existing rebate of $1850 for the installation of solar panels.
Landlords can apply and pay for the system and installation themselves, or arrange to share the loan repayment with their tenants.
RACV Solar CEO Andy McCarthy says savvy landlords will take advantage of the loans to install solar systems that will increase the value of their property. “It’s also a clever way for landlords to add value for their tenants to try to keep them ‘sticky’ and stay in that property for longer.
Alternatively he says landlords might negotiate with a tenant to contribute half the cost of a solar system at about $19 or $20 a month. “The landlord gets the improved capital value of the property having solar panels and the tenant gets lower electricity bills for as long as they stay there.
“Every month the tenant pays that $19 or $20 they’re saving potentially $50 or $60 on their electricity bills.”
It’s one of the most attractive investments on the market. The financial savings are obvious, and for the person buying the system, the environmental benefits are just the cherry on the top.
Andy says all the government rebates now available can add up to about half the cost of a quality rooftop solar system. This reduces the typical ‘payback’ time needed to recoup the up-front cost from eight or nine years to four or four-and-a-half years.
“It’s one of the most attractive investments on the market. The financial savings are obvious, and … for the person buying the system, the environmental benefits are just the cherry on the top.”
Andy welcomes the government initiative, saying it’s the first he’s seen to help break down the barriers to accessing solar for renters. He says the plan effectively addresses the issue of the short-term nature of tenancy versus the long-term savings of solar.
He says while domestic solar systems have traditionally been the preserve of home owners, the new interest-free loans would allow renters to benefit from lower power costs.
Solar Victoria has information for landlords and tenants interested in taking up the solar-power incentive. Find out more at solar.vic.gov.au. To find a solar solution for you and your home visit racv.com.au.
Solar loans FAQs
Am I eligible for the new interest-free solar loans?
To qualify for the loan:
- The rental property must be valued at less than $3 million and not have existing solar panels.
- The property must be tenanted with a rental agreement in place.
- The tenants’ combined income must be less than a combined $180,000 a year.
What are the government solar-power rebates, discounts and loans?
The Victorian government has several solar incentives available. All are subject to conditions and eligibility criteria.
Solar panel (PV) rebate
Eligible households can claim a rebate of up to $1850 on the cost of a solar panel system.
Solar battery rebate
Point-of-sale discount on solar batteries of up to $4174 for eligible households.
Solar hot water rebate
Rebate of up to $1000 on solar hot-water systems for eligible households.
Solar rebate for rental properties
Rebate of up to $1850, and interest-free loan of up to $1850, available to eligible landlords.
Solar for community housing
Rebates of up to $1850 per tenancy for not-for-profit community housing providers.