In a major policy announcement ahead of the March State Election, a re-elected Malinauskas Labor Government would establish a $500 million pre-sale guarantee fund that will unlock more apartment developments in the CBD and accelerate the delivery of more homes for South Australians.
Through the fund, the South Australian Government would go guarantor on up to 50 per cent of dwellings in eligible off-the-plan developments, up to a cap of $30 million per project so developers can start construction.
Developers would be required to meet strict eligibility criteria, including having planning approval in place, being financially sound and having a proven track record delivering apartment projects.
The initiative is targeted at shovel-ready developments within the Adelaide CBD that can deliver housing quickly, helping to support jobs in the construction sector and increase housing supply in the short-term.
To that end, for developments to be eligible they must be capable of commencing construction within six months of receiving approval.
An establishment fee of $50,000 and an annual facility fee of 1 per cent on the guaranteed value would apply to successful applicants.
The number of apartment buildings approved for development continues to rise in South Australia due to many of the State Government's code amendments permitting more density and height.
However, over the last 10 years, 2,414 apartments have received planning approval but have not commenced across the CBD.
This initiative aims to address one of the key challenges facing developers - meeting financiers' pre-sale requirements - helping to bring forward construction of well-located, high-quality apartment projects.
At the end of the project, in the unlikely event that the dwellings remain unsold, the developer would call upon the guarantee and the Government will purchase them at a discount of 10 per cent of market value.
Previous local development projects, like the Nightingale development at Bowden, were supported by a State Government underwrite through Renewal SA to help the project proceed.
In that case, all apartments sold privately without the Government being called upon.
The Government will undertake targeted consultation with industry before finalising fund parameters, eligibility and fee structures.
Just over one year on from the launch of the Premier's Housing Roadmap, the Malinauskas Government continues to pull every lever at its disposal to increase housing supply.
The Government is investing in urban renewal projects, unlocking more greenfield and infill land for homes, delivering the first net-increase to SA's public housing stock in a generation and investing in critical water infrastructure, without which new homes could
not be built.
The latest ABS data shows South Australia is breaking records for homes completed (12,692 for 2024-25 – the highest ever) and under construction (14,311 – the highest ever excluding the year the Homebuilder program was active).
As put by Peter Malinauskas
Adelaide is growing out and up.
While we continue to deliver land releases and water infrastructure for more homes on bigger blocks in metropolitan Adelaide, the Government is also accelerating options for well-priced medium and high density living in our city.
Our policy is all about giving people choice.
There is a momentum in the state that we have never ever seen before – more homes competed and under construction than ever before, more cranes in the sky than ever before, and industry backing in our economic and housing policies as the best in the nation.
This election commitment will get more South Australians into homes and jobs and will mean more builders investing in the future of our state.
As put by Nick Champion
Having the Government act as guarantor will give banks the confidence to they need to back more housing projects in our city.
We are leveraging our state's strong economic position to drive more housing supply.
First home buyers will now have the confidence to sign a contract knowing their apartment build will proceed quickly.
In the last four years our Government have unlocked an unprecedented amount of land, delivered the first net increase to public housing and continued to build more homes for more South Australians.
As put by Bruce Djite, Executive Director, Property Council of Australia, SA Division
We applaud the Malinauskas Government for listening to industry, for their willingness to collaborate, and for taking another significant step in tackling the housing crisis.
Our recently launched Election Platform, "Ready, Set Grow" called on the next State Government to adopt our CBD and Corridors housing package and we welcome the speed with which the Premier has acted in committing to this part of the package.
It is critical for this underwrite to also extend to corridors as identified in the Greater Adelaide Regional Plan and we look forward to continuing our work with the Malinauskas Government to ensure the parameters and jurisdictions where the $500M applies delivers the best housing outcomes and best bang for buck.
