South Australia has launched a new rent-to-buy scheme aimed at helping long-term renters transition into homeownership.
The Rent-To-Buy Affordable Housing Initiative, announced as part of the state’s budget, will allow eligible renters to purchase one of 100 new homes currently under construction.
The program is designed to support key workers and long-term renters who have struggled to break into the housing market, realestate.com.au reported.
“We know secure and affordable housing is fundamental to strong communities and a thriving economy, and through this scheme, we’re investing in the wellbeing and stability of families across our state,” said Nick Champion (pictured), SA minister for housing and urban development.
Champion described the scheme as a way to get South Australians “off the rental roundabout.”
The initiative supports the Malinauskas government’s broader housing agenda, including reforms to EFPAs that unlock land for up to 61,500 new homes under the Greater Adelaide Regional Plan.
Rent-to-buy (also known as rent-to-own) typically allows tenants to lease a home with the option to buy it later at a pre-agreed price. While not new in Australia, the concept has evolved in recent years, particularly through build-to-rent-to-own models.
One example is Assemble’s Kensington projects in Melbourne, where rent and purchase prices are fixed over a five-year period. However, regulatory support varies across states.
In Victoria, most rent-to-buy arrangements are banned unless offered by registered housing associations or meet specific legal requirements.
In South Australia, rent-to-buy can only be offered through the South Australian Housing Trust, which is the mechanism enabling this new initiative.
Under the South Australian model, eligible tenants can rent homes for up to three years at 75% of market rent. At the end of the lease, they will have the first right to buy the home at the price set when they moved in.
To qualify, tenants must:
The scheme is open to all eligible applicants, but priority will be given to renters who have been employed long-term and spent extended time in the rental market.
Renters will be pre-qualified to ensure they are financially capable of purchasing the property at the end of their lease.
The initiative follows South Australia being ranked #1 in the Housing Industry Association (HIA) Housing Scorecard, a biannual report reviewing residential building activity across Australia.
SA scored 88 out of 100, with the number of house commencements now 23.1% above the decade average.
“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,” said Stephen Knight, executive director of HIA SA.
“It has the potential to be a game changer for getting long term renters into homeownership.”
