Two housing projects to create more than 1,900 homes across suburban Adelaide will receive more than $500 million in funding — but hundreds of public housing residents will be forced to move when properties are demolished to make way for new homes.

The measure is one of several relating to housing in this Thursday’s upcoming state budget, with the state government also announcing it will abolish stamp duty for all first homebuyers building or purchasing new homes.

The two housing construction projects at Seaton and Noarlunga had been previously announced, but have now had funding of $425 million and $150 million respectively set aside in the budget.

The Seaton project includes 865 houses and townhouses, and 450 apartments, across a 36-hectare site, with the government promising “at least 15 per cent” affordable housing and 30 per cent social housing.

A total of 388 existing housing trust properties described by the government as being “no longer fit for trust tenants” will be knocked down — but the government said that the number of public homes lost would be matched by new builds.

The 36-hectare site at Seaton will accommodate 1,315 new homes.(ABC News: Guido Salazar)

It said 341 of those properties were currently tenanted, and said the process of writing to residents who would be forced to move “formally began yesterday”.

It said an inquiry line had been established for residents seeking information.

The government said alternative accommodation would be found for affected tenants as they were moved out in stages over a six-year period.

“They will experience the dislocation of being moved but they’ll be going into sometimes brand new — and, if not, very modern, fit-for-purpose — accommodation,” Treasurer Stephen Mullighan said.

“We’re aiming to relocate tenants into the western suburbs.”

Mr Mullighan said the site — which is bounded by Frederick Road, Glenburnie Street, West Lakes Boulevard and Tapleys Hill Road — would now host a “much bigger development” than what had already been proposed.

“The previous government announced plans to knock over 30 houses and return more than 100 on a select site opposite the Seaton High School,” he said.

“This is a much, much larger development than was previously contemplated. 

“This land is currently owned by the South Australian Housing Authority and contains nearly 400 housing trust homes. These will be progressively redeveloped to restore the amount of public housing on a one-for-one basis.”

‘Vacant paddock for three years’

The state opposition recently criticised the government for leaving the site in the condition of a “dust bowl”, and on Tuesday said the project “should have started many years ago”.

“This is vacant land owned by the government,” opposition Social and Community Housing spokeswoman Michelle Lensink said.

Ms Lensink previously said the site had been left languishing as a “dust bowl”.(ABC: Guido Salazar)

“It’s just been a vacant paddock for three years.

“It’s in the middle of a housing crisis, the housing crisis has been building for several years. Labor’s sat on this piece of land and now they’re announcing it as a major announcement — [it] was announced by [then-premier] Steven Marshall and myself three years ago.”

But the government said both projects, including Noarlunga, were intended to make housing more affordable.

The Noarlunga project was announced in April 2023.(ABC News: Jessica Warriner)

That project, near the South Adelaide Football Club, was unveiled in April last year.

The government said it would include 80 new housing trust homes and 15 per cent affordable housing, and that the first residents would begin moving in by early 2027.

“We’ve got a huge pressure across our country with housing. The solution required is a huge boost to supply, to get more South Australians into home ownership quicker,” the treasurer said.

Stamp duty and grant thresholds abolished for some buyers

First-home buyers purchasing new homes, including flats and units, in South Australia will have stamp duty abolished, the government said.

Stamp duty had already been abolished in last year’s budget for first-home owners purchasing new homes valued up to $650,000 — but the government said it would now remove it completely.

“There will no longer be a dollar of stamp duty for any new build for any new homebuyer in South Australia,” Premier Peter Malinauskas said.

“We are now getting rid of that cap of $650,000.”

The government said it was also abolishing certain property-value thresholds for the $15,000 first-owner grants.

Premier Peter Malinauskas made the announcement alongside Treasurer Stephen Mullighan. (ABC News: Stephanie Richards)

One prospective first-home buyer, Isabella, said she had been looking around for a home in Adelaide’s west for “almost two years”, and said the changes to stamp duty “will definitely change direction for me”.

“Something like this means a lot to people like myself who are looking,” she said.

“It can be really taxing spending your weeks researching homes and spending your weekends at auctions and open houses.”

Master Builders SA CEO Will Frogley said the measure could make tens of thousands of dollars difference to homebuyers. 

“Today’s announcements will see savings or benefits to a homebuyer of $50,000 on a housing price of $750,000, that’s a heck of a lot of money for anyone, but especially a first-home buyer,” he said.

“We need to build more homes and the best way to keep housing affordability is to increase supply. Stamp duty dis-incentivises South Australians from building a home.

“It could be that the benefits will be tens of thousands of dollars more over the life of the loan because it’s less money they have to borrow and pay interest on.”

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