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Heating Options for New Homes in Australia

6 October 2026Blog6 min

Ductwork, gas connections and electrical circuits get decided during the build, not after it. By the time a new home reaches lock-up, the heating decision has largely been made, or the range of practical options may already be limited by earlier infrastructure decisions, which is why it needs attention earlier than most people expect.

There is more than one reasonable answer. Depending on the climate zone, heating and cooling can account for 20% to 50% of the energy used in Australian homes and the system that suits a humid northern climate may not suit a cooler inland location. This article covers the main system types, how to match one to your climate and floor plan, some of the factors that may influence installation and running cost.

Australian Gas Networks is a gas distributor. We operate the pipeline network that delivers natural gas to the meter. We do not sell heating systems, appliances or gas plans, and nothing here is a recommendation to choose one system over another.

Key Summary:

Timing: Infrastructure decisions are often finalised during the build, so system choice should ideally be considered during the design stage.

Function:   Gas heating and electric reverse-cycle heating both warm your home, but they use different infrastructure and energy sources, gas versus electricity, which affects what your build needs to support them.  

Climate: The National Construction Code splits Australia into eight climate zones, and the most suitable system can differ between climate zones.

Assessment: Final system design and sizing should be confirmed by the appropriately licensed professionals for the systems being installed, such as a licensed gasfitter, electrician.

The main heating options for new builds

Ducted gas heating uses a central gas furnace, typically installed under the floor, in the ceiling, or on an external wall, to distribute warm air throughout the home via a network of ducts. Ducted gas systems can be zoned so only the rooms in use are heated. Ducted heating is just one gas heating option available. Other products, including space heaters, wall furnaces and log fires, may suit homes where only part of the home needs heating.
 
Electric reverse-cycle systems provide both heating using heat-pump technology to transfer heat   from the outside air into the home. According to the Australian Government, reverse-cycle system can use one unit of electricity to provide around three to six units of heating energy. Performance varies by model, climate, system design, sizing and operating conditions.
 
Ducted and wall-mounted split systems can both provide heating. Ductwork can add system losses, so compare the rated performance, zoning controls and installation design of the specific systems being considered.
 
Split systems use the same technology without whole-home ducting, heating room by room.
 
Hydronic systems circulate heated water through radiators or in-slab pipework. They provide heating only. Installation cost, operating noise and maintenance needs vary by the heat source, system design and home construction.
 

Matching a system to your climate zone

The National Construction Code divides Australia into  eight climate zones, built from Bureau of Meteorology data and published by the Australian Building Codes Board.

Your climate zone affects how much heating your home needs and how a system should perform. In cooler inland and southern areas, heating load is higher, and how quickly and evenly a system warms the house matters more. In northern Australia, heating needs are lower for most of the year, and a smaller or simpler system may be sufficient. Across much of coastal South Australia and New South Wales, heating needs sit in between, meaning the most suitable option will depend on factors such as household preferences, home design and local climate conditions.  

Matching a system to your home's design and household

Your floor plan affects how heating should be distributed through the home. Open-plan living areas may require system capacity and air distribution to be considered carefully because they condition a larger volume of space. Homes with several closed rooms used at different times of day may suit zoning, whether through a zoned ducted system or individual units. Homes occupied for long periods may have different heating patterns from homes that are vacant during the day.  

Insulation, draught sealing and window coverings reduce heating load before any appliance is chosen, so sealing draughts and improving insulation can reduce heating  demand, whichever system you choose.

Two key factors can affect the options available for a new build. The first is whether a reticulated gas connection is available and eligible for the site, since  connecting a new home to the gas network is a separate process from the building process and runs on its own timeline. The second is electrical capacity, since larger ducted reverse-cycle systems can require switchboard or supply upgrades. Connection eligibility, fees and timelines vary by state and can change over time.

Victorian rules restrict new reticulated-gas connections for certain new residential developments. From 1 January 2027, Victorian building rules require new homes to be built all-electric, subject to any applicable transitional arrangements.

Before including gas infrastructure in your design or build contract, confirm the current requirements for your site with your builder or developer, the relevant planning authority or council where applicable, and the local gas distributor. Refer to Victorian Government Building Electrification.

These factors should be considered as part of the broader home design and appliance selection process. Gas work must be carried out by an appropriately licensed gasfitter, and electrical work by an appropriately licensed electrician. Appliance selection and sizing should be confirmed by the relevant licensed trade as part of the building process.

Comparing install cost and running cost

This article does not quote fixed prices because installation costs depend on the home, the site and what the builder has already allowed for. The main drivers are the length and complexity of duct runs, the number of zones, whether a gas connection sits in the build contract, and whether electrical capacity needs upgrading. Considering ductwork, electrical capacity and service locations during design may avoid some later retrofit work. Obtain itemised quotes, as the cost difference varies by home, contract inclusions and site conditions.  

An efficiency figure tells you how much energy a system uses to deliver heat, not what appears on your bill, which also depends on tariffs, hours of use and climate. On the gas side,  usage charges and the daily supply charge are charged separately and both belong in the calculation. AGN does not provide individual bill forecasts. Households comparing systems should refer to their chosen retailer's tariffs and seek independent advice.

Consideration

Ducted gas heating

Electric reverse cycle
What it does Provides heating via a central gas furnace and ductwork.   Provides heating via an electric heat pump and ductwork.  
Comfort and operation

Provides central heating through ducted outlets. Airflow, warm-up time, temperature distribution and noise vary by appliance, duct design, zoning and the home's insulation and layout.  

Provides heating through ducted outlets. Airflow, warm-up time, temperature distribution and noise vary by model, fan settings, system design and the home's insulation and layout.  
Build infrastructure A gas connection, meter, furnace and ductwork may be required, subject to local eligibility and build requirements.   Electrical capacity, outdoor-unit space and ductwork may be required.  
Zoning Zoning may allow different areas of the home to be heated at different times.   Zoning may be available with ducted systems; separate split systems can be controlled room by room.  
Heating performance measure
 Furnace efficiency measures the useful heat produced from the gas consumed. Australian Government Energy Rating information indicates gas ducted-heater furnace efficiency typically ranges from around 71% to 90% at the point of end use. Ductwork can reduce whole-system performance. A Coefficient of Performance, or COP, measures the heat delivered for each unit of electricity used. According to the Australian Government, reverse-cycle systems can use one unit of electricity to provide around three to six units of heating energy. Performance varies by model, climate, system design, sizing and operating conditions.
Electricity use Uses electricity for components such as fans, controls and ignition. The system operates on electricity.
Energy labelling Energy-efficiency information and labelling requirements vary by gas-heater type and jurisdiction. Many non-ducted reverse-cycle systems display a Zoned Energy Rating Label. Check product information for the specific model.
Maintenance Follow the manufacturer’s instructions and arrange servicing or safety checks with an appropriately licensed professional. Follow the manufacturer’s instructions, including filter-cleaning guidance, and use an appropriately qualified air-conditioning or refrigeration technician for service.

Both systems have maintenance requirements. Follow the manufacturer’s instructions for cleaning, servicing and safety checks. Arrange assessment by an appropriately licensed technician if the system is not operating as expected or if there are safety concerns.

On the gas side the  warning signs that a heater is due for a service are worth knowing before the first winter in the house.

Questions to ask your builder or installer

  • What heating infrastructure is already included in the build contract, and what would be treated as a variation?
  • Is ductwork included, and does adding zoning change the price?
  • Does the design need an electrical capacity upgrade or switchboard upgrade, and who pays for it?
  • Is a gas connection part of the contract, or does it need to be arranged separately?
  • How was the heating system sized for the home and local climate?
  • What factors are likely to have the biggest impact on running costs in this location?
  • If you are building a new home, ask similar questions when comparing hot-water systems, as these decisions are often made at the same stage of the build.  Final system selection and sizing must be confirmed with a licensed gasfitter and a licensed electrician. 

Making the decision

The right system depends on your climate zone, your floor plan, how your household lives and what the build already includes. Two homes in the same suburb can reasonably reach different answers. Get a site-specific assessment from a licensed gasfitter and a licensed electrician before the design is locked. It is usually easier to consider infrastructure requirements at the planning stage than after construction has progressed. Ask for itemised quotes before approving any variation.

FAQs about heating in new homes

It depends on the type of development and the relevant approval dates. Since 1 January 2024, new dwellings, apartment developments and residential subdivisions that require a planning permit have generally not been eligible for a new connection to reticulated natural gas. From 1 January 2027, Victorian building rules require new homes to be built all-electric, subject to any applicable transitional arrangements.

Before finalising a home design or signing a contract, confirm the current requirements for your site with your builder or developer, the relevant planning authority or council where applicable, and the local gas distributor.

Refer to Victorian Government Building Electrification.

Costs can depend on the location of the existing gas main, site access, development type, any required network work and whether connection work is included in the build contract. Costs and eligibility vary by state, distributor and site. Ask your builder or developer and the local gas distributor for current, site-specific information before making a decision.

Important information

This article provides general information only. It does not take account of your home, location, build contract, energy needs or personal circumstances and is not a recommendation to choose a particular heating or energy option.

Australian Gas Networks operates gas distribution networks. We do not sell energy plans, heating systems or appliances. Installation and running costs, system performance, tariffs, connection eligibility and regulatory requirements can vary by location, home design, product, installer and time.

Gas work must be completed by an appropriately licensed gasfitter and electrical work by an appropriately licensed electrician. Heating design and system sizing should be confirmed with relevant licensed professionals.

Victorian requirements for new reticulated-gas connections and all-electric new homes may apply depending on the type of development and approval dates. Check current site-specific requirements with your builder or developer, the relevant planning authority or council where applicable, and the local gas distributor.

References

Australian Government, energy.gov.au, Heating and cooling: https://www.energy.gov.au/households/heating-and-cooling

Australian Government, YourHome, Heating and cooling: https://www.yourhome.gov.au/energy/heating-and-cooling

Australian Government, YourHome, Australian climate zones:  https://www.yourhome.gov.au/getting-started/australian-climate-zones

Australian Building Codes Board, Climate zone map: https://www.abcb.gov.au/resources/climate-zone-map

Victorian Government, Building Electrification Regulatory Impact Statement: building-electrification-regulatory-impact-statement_3785-(1).pdf

Australian Government Energy Rating, Residential Space Heaters in Australia & New Zealand Product Profile: Microsoft Word - SpaceHeater - Product Profile FINAL

Last reviewed: October 2026.

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