Choose the right project type
Smaller, simpler projects in established markets are generally easier to fund without presales
Development Finance
Can You Get Development Finance Without Presales?
7 min read- Finance Guide
- Updated 2026
Key facts
- Profit margin required 15 - 20%+
- Equity contribution 20 - 35%
- Funding type Staged drawdown
- Pre-sales required Often not always
- No presales possible Usually stronger deals
1300 421 044
1300 421 044
Yes, it is possible to get development finance without presales in Australia, but it is usually harder than a standard development loan and it is not available for every project. Traditional banks often prefer or require strong presale cover on larger residential developments because presales reduce sales risk and help demonstrate market demand. That said, some smaller projects, well located boutique developments, townhouse projects, land subdivisions, and deals backed by experienced sponsors can still be funded without presales where the overall risk profile is strong.
When no presales are in place, lenders usually compensate by looking more closely at the quality of the site, developer experience, equity contribution, contingency buffers, exit strategy, and the realism of the valuation and feasibility. In practice, that often means a lower leverage level, stronger borrower financials, and more scrutiny around how the debt will be repaid if sales are slower than expected.
No presales does not mean no evidence of demand. Lenders still want strong market evidence such as comparable sales, local absorption rates, realistic pricing, and a credible plan to sell or refinance the completed stock.What kinds of projects may be funded without presales?
Not every development is suited to no presales finance. Lenders are generally more open where the project is simpler, the stock is easier to sell, and the borrower has a strong balance sheet or proven delivery history. Projects more likely to be considered include:
-
Small townhouse developments
-
Boutique apartment projects in established markets
-
Land subdivisions with clear local demand
-
Build to hold projects with a refinance exit
-
Projects backed by substantial equity or additional security
-
Experienced developer transactions with conservative leverage
Larger apartment projects, higher density developments, and sites in softer or thinner markets are far more likely to face strict presale requirements.
What lenders assess instead of presales
If a project has no presales, the credit assessment becomes more detailed. The lender still needs confidence that the completed project can be sold down or refinanced within the loan term.
Key areas usually include:
Independent valuation and end values- Developer track record and team capability
- Construction contract strength and builder quality
- Detailed feasibility with realistic contingencies
- Local demand evidence and comparable sales
- Borrower net worth and liquidity
- Exit strategy if stock is retained or sold progressively
- Debt coverage and interest capitalisation assumptions
Lower
Leverage is often required without presales
Stronger
Equity and balance sheet support are usually needed
Clear
Exit strategy is essential when presales are absent
Need Help with your Project?
Why no presales finance is harder to get
Presales reduce lender risk by showing real buyer demand before construction starts. On larger projects, especially apartment developments, lenders have historically relied on presales as a core risk control.
Without them, the lender is exposed to more uncertainty around settlement risk, stock absorption, price softening, and the time needed to clear completed inventory.
That is why no presales finance is usually easier where one or more of the following applies:
-
The project is relatively small and straightforward
-
The site is in a deep, proven market with strong recent sales evidence
-
The borrower can inject more equity or offer extra security
What usually replaces presales in the deal structure
If presales are not available, lenders often look for more support elsewhere in the capital stack.
Typical no presales credit adjustments
More borrower equity
Often required
Lower lender leverage
Common outcome
Support lenders may accept
- Additional cash equity
- Extra property security
- A refinance or hold strategy supported by rental evidence
How no presales development finance is usually structured
Even without presales, development finance is still usually advanced as a staged construction facility rather than a lump sum.
The facility commonly works through milestones such as:
-
Site settlement or debt refinance
-
Early works and slab stage
-
Frame and structural stage
-
Lock up and services stage
-
Fit out and practical completion
-
Sell down or refinance exit
A quantity surveyor or lender appointed consultant normally signs off each stage before further funds are released.
What to expect if you apply without presales
You may still be approved, but the lender will usually price and structure the deal more conservatively
Applications without presales often need stronger feasibility evidence, stronger borrower financials, and a very clear exit plan
Some lenders will ask for partial presales, lower leverage, or extra security even if they market themselves as flexible
Common reasons no presales applications get declined
When presales are absent, weak points in the deal become much more visible. A lender may still like the site but reject the overall risk profile if too many elements are marginal.
Too much reliance on future sales
If the whole debt depends on a perfect sell down after completion, lenders may see the exit as too thin.
Possible solutions include:
-
Lower leverage at the outset
-
Secondary exit through refinance
-
Strong evidence of rental demand for hold stock
Limited developer experience
Without presales, inexperience becomes a much larger concern because the lender has fewer external signals supporting the project.
Solutions may include:
-
Bring in an experienced delivery partner
-
Start with a smaller, simpler project
-
Provide stronger guarantor support
Weak feasibility assumptions
Aggressive end values, low contingencies, or unrealistic selling periods can make a no presales deal fall over quickly.
Common issues include:
-
Inflated sale prices
-
Inadequate cost allowances
-
No allowance for slower absorption
Location or stock type risk
Even a well run project can struggle without presales if the local market is shallow, oversupplied, or too specialised.
Solutions may include:
-
Simplify the product mix
-
Reduce debt and increase equity
-
Stage the project to reduce exposure
How to improve your chances without presales
-
1
-
2
Build a conservative feasibility
Use realistic end values, robust contingencies, and honest selling timeframes
-
3
Strengthen your equity position
More cash equity or extra security can partly offset the absence of presales
-
4
Show strong demand evidence
Comparable sales, local agent feedback, enquiry history, and rental evidence all help support the story
-
5
Present a credible exit
Explain clearly whether the debt will be repaid by sales, refinance, or a staged hold strategy
-
6
Approach specialist lenders
Major banks may be restrictive, while some non bank or private lenders can consider no presales transactions on the right terms
Speak with a Development Finance Specialist
No presales development finance can vary significantly depending on the project size, location, exit strategy, and the strength of the borrower.
A specialist can review your project and help determine whether no presales funding is realistic, or whether partial presales, more equity, or a different structure may be needed.
Speak with a finance specialist about funding a development without presales.
Submit the short form below and a development finance specialist will review your project and discuss whether no presales funding may be possible.
Contact Form
Your enquiry is confidential
Prefer to speak with someone directly ?
Call us to discuss your development project
Related Questions
Explore these related questions to learn more about development finance
