A scheme by one state government has ignited a trend among legislators across the country.
New schemes being unveiled by jurisdictions across the country involve buying new apartments from developers before they have broken ground. Image: Getty
Last year, the New South Wales state government debuted the introduction of a pre-sale guarantee scheme for developers to help get new residential projects off the ground.
When developers embark on building a new apartment block, one major hurdle to turning designs into reality is securing financing from a bank to be able to begin construction.
Generally, banks will not provide lending until a certain number of apartments in a project have already been sold off the plan.
Sales can often be slow to start, particularly in sluggish economic environments. Meanwhile, many buyers are hesitant to commit to a purchase when completion could be years away.
Under the NSW state government’s $1 billion scheme, which kicked off in October 2025, the state will commit to buying a number of the homes for sale so that developers can secure financing, with the understanding that in an ideal scenario, the homes that have been guaranteed by the government will actually be sold to real buyers as the project progresses.
If dwellings remain unsold, the developer can “call” on the guarantee and the government will purchase them at a discounted rate.
States follow suit
South Australia was the first state to consider a similar initiative, with the Labor government making it an election promise heading into the March 2026 vote, and subsequently earmarking $500 million for the initiative in its 2026-27 budget.
Western Australia was the next to debut a pre-sale guarantee scheme, with a program valued at $250 million announced at its 2026-27 state budget in April.
Those schemes are yet to be implemented so take-up by developers remains to be seen. But in NSW, the offer has proven incredibly popular.
NSW updates eligibility to help affordable housing and smaller builds
Since launching in October, NSW has guaranteed more than 600 new homes under the program, and received over 45 expressions of interest from developers across the state.
And this week, NSW unveiled a number of changes to the program to enhance its use and support more affordable housing projects, as well as smaller builds.
The changes include expanding the program to support 100% of affordable housing projects worth up to $30 million as long as they are delivered by not-for-profit community housing providers.
For projects set to be sold on the open market, the program will also be able to guarantee up to 75% of homes in projects delivering fewer than 20 homes, up to a value of $30 million. Previously the government would only guarantee up to 50% of homes in any given project.
And NSW has changed the eligibility criteria for projects from a blanket minimum $5 million valuation to requiring instead that the project includes at least four homes.
In an address at the Property Council’s NSW Housing Summit on 11 June, NSW minister for planning, Paul Scully, said the changes came in response to feedback from “proponents, financiers, and community housing providers”.
“The presale finance guarantee has already proved it can unlock store projects and accelerate housing delivery by giving lenders the confidence they need to back good projects. These changes will allow more affordable housing and smaller developments to access support, so more homes can be built faster where communities need the most,” Mr Scully said.
The Community Housing Industry Association of NSW welcomed the change, noting that community housing providers who oversee affordable housing projects are “not immune to a challenging construction environment”.
“Too many people can’t find a safe and secure home in NSW. The extension on the Pre-Sale Finance Guarantee Program is the right call – it’ll enable more homes to be built for people and families who need them the most, and recognises that community housing providers have the track record to deliver them”.
Are you interested in learning more about apartments being built across Australia? Check out our dedicated New Homes section.
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