Even a handfed baby is usually scared in a new home, because you're a different human than the one that they're used to. If you've seen him handfeeding the bird then you know that it was really handfed.

Holding food in your hands is a great way to make friends with a young handfed baby. They already associate human hands with food, so it's natural for them to take what you're offering.

Thank you, Dan. I will visit that pet shop soon.

Tielfan is right. Hand-raised cockatiels are usually scared in a new home too - how much depends on their personality of course.
My tiel was definitely hand-raised and was actually very friendly in the breeder's house, "chose" me and started being nice to me, but when we came home he was scared and although he had a good appetite (some tiels don't even eat) he didn't want to be cuddled any more (contrary to when he was in the breeder's place).
I didn't force things and one day he came out and started socializing.
Give him time.
How are things going now by the way? I can see that you started this thread a few months ago.