Changing market conditions combined with government housing initiatives have helped keep the dream alive for SA’s first home buyers in 2026.
In a year where Adelaide property prices peaked mid-year at a metropolitan dwelling median of just over $928K, many first home buyers struggled to see themselves achieving their home ownership dream. But following that mid-year peak, property prices across South Australia finally began to soften – as they have done nationally - making that first home entry point a little easier to reach.
The Cotality Home Value Index for October showed Adelaide property prices fell -1.2% for the month, and -3.9% for the quarter to a median dwelling value of $916,860. For first home buyers, lower property prices mean lower deposits are required to take that initial step towards owning their first home. And with government initiatives working towards increased housing supply while providing easier entry requirements, there are encouraging signs for prospective buyers.
Government Support
During 2026 the South Australian government abolished stamp duty for eligible first home buyers purchasing new homes, and Revenue SA offered a $15,000 First Home Owner Grant on new homes with no property value price cap.
In conjunction with state initiatives, the federal government introduced the 5% Deposit Scheme which first home buyers can access for both new and established properties priced under $900K. This scheme provides the bonus of no requirement for costly Lenders Mortgage Insurance, helping to reduce the initial costs associated with first home buying.
These initiatives remain available to eligible first home buyers for the foreseeable future. Combined with decreasing property prices, they offer considerable savings for buyers who have the capacity to service a mortgage but find saving a standard 10% deposit + initial costs difficult, given the current cost of living.
Increased Housing Supply
In the twelve-month period to September 2026, South Australia approved 16,408 new home builds - the highest number in the state’s history, as part of the Housing Roadmap plan to increase housing supply.
That represents a 44% increase in a two-year period, and is helping to rectify South Australia’s housing supply problem.
Some of these housing developments offer affordable housing and dedicated first home buyer land releases such as the Playford Alive project in Adelaide’s northern suburbs. As first home buyers are being priced out of the inner city suburbs, northern and southern development projects have become a solution for many.
Increasing Mortgage Interest Rates
Early November saw the RBA’s fifth rate hike for the year, increasing the official cash rate to an 18 year high of 4.85%.
Higher mortgage interest rates means reduced borrowing capacity but also increased buyer bargaining capacity due to less buyers, ergo less competition. Conversely, if buyers wait for interest rates to fall, there will be more buyers, more competition and higher prices.
So, the most important thing for first home buyers in 2026 and those looking to buy early in 2027 is to obtain reliable financial advice and to focus on their budget. If it can accommodate rising mortgage repayments then taking advantage of current government initiatives, decreasing property prices, increased housing supply and increased bargaining power might be beneficial.
If you’re buying your first home in Adelaide, get in touch. Our friendly real estate agents have on- and off-market properties that could be perfect for you! Call us today or drop in and say hi – we’d love to help!
