Historic high for new HomeStart loans expected to ease SA’s record low vacancy rate

While South Australia suffers through the worst housing vacancy rates in the country, there are signs of greener pastures ahead.

South Australia has recorded the greatest number of home builder loans in a single year, with two thirds going to first home buyers.

Housing Minister Nick Champion on Monday announced a record high of “construction-related lending” through the government’s HomeStart plan since it was launched in 1989.

In 2023-24, 1081 government-backed loans were issued, compared to an average of 625 over the past five years.

In February, HomeStart dropped deposits to a nationwide two per cent for a home and land package, in a government bid to lift housing supply.

HomeStart buyer Tim Doherty said securing a deposit through private lenders was his greatest challenge, despite the fact he could afford repayments.

Tim Doherty and Vanessa Reinboth in front of their new Seacombe Gardens home, built with the aid of HomeStart. Picture: Supplied

Mr Doherty said he looked forward to stepping into his Seacombe Gardens home towards the end of this month.

“It was a big weight off my shoulders, to get our foot in the door and have something that’s ours … it’s not much but it’s something,” he said.

Housing Minister Nick Champion hailed the increase in HomeStart loans for first-home buyers. Picture: Mark Brake

Mr Champion said that construction time frames in SA were “almost back to normal” after cost blowouts linked to labour and material shortages.

“We need builders to build, but we need people to be able to lend, and for people with limited equity but good incomes, (HomeStart) lets them get into the market,” he said.

South Australia is suffering the worst vacancy rate of any state or territory, with 0.83 per cent of homes available for lease compared to a national average of 1.08 per cent, according to realestate.com.au.