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At a time when interest rates and other economic headwinds seemed to blow the home ownership dream away from thousands of South Australian residents, the Malinauskas government’s HomeStart program made the Australian dream a little easier to achieve.
Over the last 12 months, the value of loans issued by the state government’s lender, HomeStart, surpassed $800 million – marking the first time it’s ever eclipsed this figure. As a result of this increased lending – more than $220 million of which was dedicated towards construction – over 2,000 South Australians have entered home ownership, a 33 per cent increase on the yearly averages of the last decade.
State treasurer, Stephen Mullighan, expressed great pride in the government’s introduction of several schemes to “help keep the great Australian dream alive, including low deposit home loans through HomeStart.”
As housing affordability increases right across the country, and with the Australian dream seeming more and more like a guarantee provided by a bygone era, Mr Mullighan insisted the Malinauskas government “want South Australians to have the same opportunities for home ownership as their parents and grandparents.”
Outside of the reduced deposit size offered by the scheme, which shaves a significant portion of time for the usual savings period for a standard 20 per cent loan, HomeStart does not require borrowers to take out Lenders’ Mortgage Insurance (LMI) – which can increase purchasing costs by up to $10,000.
Since the South Australian budget for the 2023-24 financial year’s release last month, which contained significant relief for first home buyers such as scrapping stamp duty for some purchases, HomeStart is reporting a 50 per cent increase in online applications and a 40 per cent increase in call volumes.
From 1 July 2024, eligible first home buyers who purchase or build a new property financed through HomeStart will be offered a new 2 per cent deposit home loan.
Andrew Mills, the chief executive of HomeStart, explained the changes made to the program’s lending products, such as “reducing the deposit requirement for our Graduate Loan to 2 per cent have unlocked home ownership for even more South Australians, alongside shared equity which is now used by almost one in four HomeStart customers.”
He identified additional changes outlined in the state budget as having already taken effect “resulting in increased demand from first home buyers battling higher house prices, interest rates, and living costs.”
“We’re privileged to be supporting these home buyers turn their dreams into reality,” Mr Mills concluded.
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