More South Australian renters are taking advantage of the state’s Starter Loan scheme, which is set to report a stronger take-up in the current financial year.
Figures from the state government showed that around 217 Starter Loan scheme applicants have been approved so far in the Financial Year 2021-2022. This is set to beat the previous record of 378 approvals for the scheme in the Financial Year 2020-2021.
Under the scheme, the state provides an interest-free and repayment-free loan of up to $10,000 to South Australians to cover up for the other upfront costs of buying or building a home.
The loan, which is administered through the state government-owned HomeStart Finance, is payable for five years and can be applied for on top of the $15,000 First Home-Owner Grant.
Applicants for the scheme must meet the net income threshold of less than $65,000 for singles and less than $90,000 for couples.
They should also have enough funds to cover for the deposit of their home loan, as the Starter Loan scheme will solely be used for other upfront costs like stamp duty.
Minister for Human Services Michelle Lensink said the growth in the demand for the scheme indicates a huge appetite to get into the housing market amid the pandemic.
“During the COVID-19 pandemic, the statistics clearly show take up of the Starter Loan has surged, which could be in part because we broadened the eligibility criteria to include moderate-income earners,” she said.
Around 70% of individuals who got the approval for a Starter Loan live in private rentals. There is also a small share of homebuyers who were Housing SA tenants.
Since its commencement in September 2019, the Starter Loan scheme has already helped 705 homebuyers.
The scheme had the highest demand in Southern Adelaide, where 79 homebuyers got approved of the scheme.
High take-ups were also recorded in the regions of Port Adelaide (52), North-East (44), Hills (33), South (21) and Central (17).
Across regional areas, Gawler/Barossa (44) registered the highest number of approvals for the scheme.
The scheme was also popular in the following regional markets: Fleurieu/Kangaroo Island (26), Lower North (8), Murray Bridge (19), Murray Mallee (4), Port Pirie (7), Riverland (12), South-East/Mt Gambier (17), West Coast (6), Yorke Peninsula (6).
Overall, the total value of Starter Loans to date is at $6.4m while the total value of the homes built or purchased with the assistance of the scheme is at around $201m.
The state government committed a further $10m for the Stater Loan scheme during the 2021-2022 Mid-Year Budget Review.
“We know it’s tough to save for a first home and that’s why this is one of many state government’s initiatives supporting South Australians into homeownership,” Ms Lensink said.
Roll-out of affordable homes
The state government also announced the roll out of 1,000 new affordable homes available for South Australians.
These homes have price tags of no more than $422,050, which is well below the current median price for a home in Adelaide at $608,624.
“Many of these homes are available through shared equity and I urge South Australians looking for housing to jump on our new HomeSeeker SA website for more information about how to save and budget for a home and for exclusive affordable home sales,” she said.
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Photo by @glt23 on Unsplash.
Collections: Mortgage News
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