Construction is underway to build 100 new homes, which are expected to be completed by early-to-mid 2021.

Human Services Minister Michelle Lensink said many properties were built on the outskirts of metropolitan Adelaide because it was more affordable, but higher travelling costs were incurred as a result.

She said the state government was acting as a developer to fund a "gap in the market".

"There are lots of South Australians who would love to buy their own home but just need the opportunities because there is not enough supply for that particular price," she said.

"At the same time, (we're) supporting the building industry, which we know needs a pipeline of work to keep people employed on a constant basis."

Of the 100 homes to be built, with up to three bedrooms and either single or double-storey, 70 will be sold for no more than $419,750.

Centina Homes is currently building 23 of the new properties.

Its director Paul Nardinocchi said the stimulus helped provide continuity of work for trade contractors, suppliers and those within the construction industry.

To be eligible, applicants must have a maximum income of $85,000 for a single person or $110,000 for a family with assets worth no more than $500,000.

It is also required that property owners live at the address for a minimum of six months.

Australian Associated Press