I seek leave to make an explanation before asking the Minister for Emergency Services, representing the Minister for Families and Communities, a question regarding home affordability.
The Hon. J.M.A. LENSINK: In the Sunday Mail of 19 June an article entitled ‘Only 5 take up Cheap Home Loans’ reported on the government’s relatively lauded program the Family Assistance Scheme, which is run by HomeStart Finance and which allows parents to take out a loan to put towards property bought by their children.
The article states:
A state government scheme to provide cheap home loans for first home buyers has signed up just five customers since its launch almost six months ago. The multi-million dollar scheme remains virtually unknown among welfare agency financial counsellors and the real estate industry. Even brokers who sell the state government funded loan admit it is more expensive than similar commercial bank loans. ‘It sounds like a good scheme to help first home buyers get into the increasingly expensive real estate market but I hadn’t heard of it before’, Real Estate Institute of SA president Robin Turner said.
Financial counsellors with welfare groups, Anglicare and Uniting Care Wesley, also had not heard of Family Assist. ‘I think many other people are not aware of it’, Anglicare spokesman Peter Bleby said.
In the state housing plan, I note that the government has set a target of 10 per cent affordable housing. My questions for the minister are:
1. How is this program contributing to improving home affordability when these organisations in the market do not even know about it?
2. What has the government done to promote it among these organisations, and what is it planning to do?
The Hon. P. HOLLOWAY (Minister for Industry and Trade): I will refer that question to my colleague the Minister for Families and Communities and also to the Minister for Housing and bring back a reply.
Thursday 15 September 2005
In reply to Hon. J.M.A. LENSINK (5 July).
The Hon. T.G. ROBERTS: The Minister for Housing has advised:
The Family Assisted Mortgage (FAM) loan facility is an innovative financial product offered by HomeStart Finance, South Australia’s government-owned home finance agency. Since its inception in 1989, HomeStart has loaned more than $3.2 billion and has assisted more than 47 000 South Australian households.
HomeStart established its FAM loan facility in mid-2004. The facility is an aggregation of existing HomeStart loan products that allows a parent, or some other family assistor, to access equity in their residential property to boost the purchasing power of a home buyer and therefore increases home affordability. Development costs for the loan facility were negligible, and the facility could not reasonably be characterised or described as a “multi-million dollar scheme.
The FAMis retailed directly by HomeStart and through its loan manager network of BankSA, Bernie Lewis Home Loans, Homeloans Plus and The Home Loan Centre. The Real Estate Institute of SA and the agencies referred to in the Sunday Mail article of 19 June 2005 are not accredited HomeStart loan writers and any business that came to HomeStart by virtue of those organisations would be by referral on a non-commission basis only.
Since the publication of the Sunday Mail article, HomeStart has made contact with the Real Estate Institute of SA and the agencies cited in the article. HomeStart has developed a strategy to market the FAM facility to these and other groups.
HomeStart will continue to broadly promote the FAM facility through its advertising campaigns delivered via television, press and the internet.
The FAM facility complements other HomeStart products that seek to deliver home ownership opportunities for young South Australians, including HomeStart’s highly successful Graduate Loan.
To date HomeStart has settled more than 450 Graduate Loans valued at more than $85 million.