Housing Affordability

Ms WORTLEY (Torrens) (14:24): My question is to the Treasurer. Can the Treasurer advise the house how the Malinauskas Labor government is assisting low-income earners enter the property market?

The Hon. S.C. MULLIGHAN (Lee—Treasurer) (14:24): As the member for Torrens knows, and many of us are aware, it is increasingly difficult for many South Australians to enter the housing market, particularly those on low and fixed incomes. The government acknowledges what is now a housing crisis, not just here but across the entire nation, and we are doing our bit in a number of ways to address it and make it easier for people to enter the housing market.

One of the ways that we are doing this is through HomeStart, the government-owned home loan lender that has helped thousands of South Australians into home ownership since its inception, I think in 1989. It creates innovative, low deposit, home loan products to support those South Australians who are faced with barriers to home ownership and who can't get finance from the big four banks in particular.

One of HomeStart's loan products is the Advantage Loan. The Advantage Loan is an additional loan product that homebuyers can add to another HomeStart home loan to cover the costs associated with entering into a loan. The HomeStart Advantage Loan is combined with a HomeStart graduate or low deposit loan to boost the borrowing power for homebuyers, enabling them to get into a property sooner and without increasing their monthly repayments.

I am pleased to report that since 13 October this year the maximum size of a HomeStart Advantage Loan has increased from $50,000 to $70,000—again, this loan product supplementing another HomeStart loan. This boost gives eligible HomeStart applicants more options to choose from when looking for a property and is yet another way in which HomeStart enables people to enter the housing market.

This change is income targeted, specifically targeted at people on low and fixed incomes. Of course, borrowers of this loan product will also benefit from the HomeStart safeguard guarantee, which maintains home loan repayments at the same level for a year to give homebuyers certainty so they don't have to worry about interest rate rises, courtesy of changes in the RBA cash rate.

HomeStart estimates that the additional buying power for eligible participants could increase the number of suburbs in reach for eligible applicants, from 158 to 178. The good thing is that repayments on the Advantage Loan aren't required until the substantive home loan has been paid in full. The Advantage Loan is one of many product innovations that HomeStart is now rolling out, and has been rolling out in recent months, to help South Australians and give them a leg up into the property market.

In August this year, the government announced that HomeStart would drop the minimum deposit requirement for its Graduate Loan to 2 per cent, wiping many months, if not years, off home deposit savings plans. Since this announcement, applications have surged by 54 per cent for this loan product. There are hundreds of households who have been able to take out a loan due to this change. The good thing is that with all HomeStart's low deposit loan products there is no lenders mortgage insurance, saving borrowers what can often be well in excess of $10,000 of additional fees.

The effort from HomeStart comes on top of the government's other policies, which we are implementing to increase access to housing affordability, including building more public housing stock and providing more units—

Mr Brown interjecting:

The SPEAKER: Member for Florey!

The Hon. S.C. MULLIGHAN: —for people suffering homelessness. We look forward to continuing to work to make housing within reach of more South Australians in the future.