Time is money in property development. Speed to market cuts costs and risks, while delays to a project can impact its profitability or even viability.

So it’s no surprise that construction finance which doesn’t require presales is becoming increasingly popular in the industry. Approved and advanced in much shorter time frames than traditional bank finance, zero presales loans enable developers to start and complete their projects sooner, recycling their capital and growing their businesses faster.

Dealing with the big financial institutions has always been a slow and time-consuming process. While their rates and fees may be marginally lower than those available from non-bank lenders, even shovel-ready, low-risk projects can be unexpectedly delayed by banks’ lengthy approval processes and constantly changing lending policies.

And banks are becoming increasingly conservative in their lending, requiring ever-higher levels of presales (up to 100%) and previous experience from developers. 

Don’t overpay for your construction finance. Most zero presales loans available in the market today are capped at 65%-75% of Gross Realisable Value, but DFP can offer finance of up to 80% of the Gross Realisable Value of your project, and our loans start from 3.25% p.a. plus a 2% line fee and 1.5% establishment fee. Get a quote from us.

For developers, finance without presales offers many advantages, including:

  • Allowing you to start your project sooner, avoiding rising construction costs
  • Less cash equity is required upfront to fund marketing and presales commissions 
  • The flexibility to sell or hold back stock, taking full advantage of market movements 

No presales finance is suitable for a wide range of projects, in particular:

  • Those aimed at owner-occupiers, who are often reluctant to buy off the plan.
  • Developments that aren’t big enough to interest the best project marketing firms
  • When there is strong demand in rising market conditions

Is a zero presales loan the right option for you? Generally, we can tell you from a single phone call. Or take our no presales quiz and see worked examples of presales vs no presales finance, as well as case studies where zero presales proved to be the best option.

In the current market, many developers are finding selling projects off-the-plan challenging. Buyers may be hesitant after hearing reports of builder bankruptcies and cladding scandals or have concerns about being disappointed on the build quality. 

Marketing completed stock instead of off-the-plan enables developers to maximise sale prices and minimise selling costs. It’s so much easier for buyers to appreciate a property when it’s finished and they’re standing inside it, or at the very least when they can see construction activity and progress on site. 

Presales reduce risk for the bank, but not for developers. Generating sufficient presales to satisfy a traditional financial institution may take several months, while site expenses and marketing costs continue to mount and market conditions can change considerably. 

When markets are softening, developers need to complete projects as rapidly as possible, while in rising markets they may stand to benefit from holding onto stock and riding the market up during construction. No presales finance gives them the flexibility to respond.

Developers have enough on their hands these days, dealing with spiking land and construction costs, shortages of materials and trades, delays in securing council approvals and other ongoing impacts of Covid-19 pandemic. 

If you don’t have the luxury of time for protracted negotiations with financial institutions to secure the funding you need for your next project, then DFP can help. We have written over $3 billion in loans for Australian and international property developers and can arrange fast and flexible finance approvals to suit your project, from large to boutique. 

Our network of capital partners is extensive, so we understand who is in the market, for what type of project and developer, on any given day.

And we can find innovative solutions requiring less equity, so you can start your project sooner. We’re experienced at working within tight timeframes, and we know how to craft funding packages tailored to suit your project, such as:

  • mezzanine finance or preferential equity to reduce the amount you need to borrow from your bank 
  • stretch funding to fill the gap when your presales are below what the bank requires, and your equity falls short of bank hurdles
  • equity line of credit so you don’t have to sell down equity in your project unnecessarily to meet upfront costs
  • funding for land banks with no development approval in place

Beyond finance, we can also provide you with specialist support, advice and project management; work with you to draw up feasibility studies, explore funding structures and estimate cash flow timelines; help manage your relationships with your underwriters; and assist and advise on the valuation and quantity surveying process.

To discuss your next project and find out a construction loan with no presales is suitable get in touch with us today.



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