South Australia's Rent to Buy Affordable Housing Initiative explained after Peter Malinauskas confirms 100 Housing Trust homes will be part of scheme
The South Australian government has confirmed dozens of homes it is building will be part of a new scheme allowing long-term renters to enter the housing market.
Premier Peter Malinauskas revealed the Rent-To-Buy Affordable Housing Initiative this week in a bid to help "young South Australians to achieve the dream of home ownership".
The latest scheme applies to 100 homes the government's South Australian Housing Trust has under construction.
The homes will first be leased to eligible renters for up to three years, who will pay 75 per cent of the market rent so they have increased capacity to save for the house purchase.
"Eligible renters are people who have been renting for a minimum of 24 months, are South Australian residents, do not currently own a property and meet the HomeSeeker SA eligibility," the state government said.
"At the end of the rental period, tenants will have the first right to purchase the home, supporting their journey from renting to ownership.
"The price for the home is fixed at the time they move in - meaning they are protected from any further increases in the property market when it comes time to buy.
"Renters would be pre-qualified to test that they meet the criteria and are expected to have the capacity to purchase the property at the end of the lease."
The state government said priority will be granted to residents "who have been employed long-term and have spent an extended period in the rental market without the opportunity to transition into home ownership".
"Tenants will enter the program on the basis that they are intending on purchasing the property and will initially be referred to HomeStart," it said.
The scheme has been welcomed by the Housing Industry Association, which on Wednesday put South Australia at the top of its housing scorecard which ranks the states.
"This initiative is a great idea and is just one more reason why SA leads the nation for housing market performance and why it has once again topped the HIA Housing Scorecard," HIA Executive Director Stephen Knight said.
"It has the potential to be a game changer for getting long term renters into home ownership."
The HIA said its scorecard "benchmarks contemporary levels of activity in each state and territory against long term averages across indicators of home building and renovations activity, lending data and population flows".
"The outlook for home building in South Australia has taken a marked step up in recent years, as economic and policy dynamics increasingly shift in the state's favour," HIA Senior Economist Tom Devitt said.
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