Climate resilient housing features in rental housing: Linking tenant satisfaction with rent premiums for retrofit decisions

Meeting net-zero targets and adapting to climate change requires substantial investments in retrofitting the existing housing stock with climate-resilient features. In rental housing, which lags substantially behind owner-occupied housing in terms of sustainability investments, it remains unclear whether the features that enhance tenants’ quality of life under changing climatic conditions also translate into rent premiums. This paper examines whether climate-resilient housing features (defined as features that enhance energy, water, and thermal performance of housing in response to climatic variability and energy insecurity) differ in their effects on housing satisfaction versus rental value. Understanding the potential trade‑off is essential to unlock further sustainability-related investments in rental housing. Using the 2022 Australian housing conditions dataset and multilevel mixed models, we find that climate-resilient housing features are more closely associated with housing satisfaction than with rent. Among the eight features studied, only outdoor shutters/awnings and double-glazed windows have ‘rent premiums’ of 2.5% and 3.7%, respectively, while also positively influencing housing satisfaction. Solar panels were significant only in the base rental model. Three other features (i.e., charging stations for electric vehicles, ceiling and wall insulation, and solar panels) positively influence satisfaction but are unrelated to rents. We discuss the implications of our findings for housing retrofit, sustainability investments, and housing policy.