In more than 20 years working in property finance, I have seen many projects unable to commence construction because they could not meet a lender’s pre-sale requirements.

These delays can increase holding costs, expose projects to rising construction costs and make it difficult to secure a preferred builder without a firm start date. I have also seen developers accept more expensive funding with restrictive terms to get construction underway.

A new WA Government initiative may help eligible projects overcome this hurdle. Applications opened on 8 October 2026 for the $250 million Pre-sale Guarantee, delivered by Keystart to help apartment and townhouse developments meet lender pre-sale requirements and begin construction sooner.

THE OFFER

Keystart can commit to purchasing nominated dwellings that remain unsold, subject to agreed contract terms. The announced support covers up to 50% of unsold homes in a development, with higher commitments of up to 60% of homes in eligible regional projects.

Developers continue marketing the homes. If another buyer is secured for a supported dwelling, Keystart’s purchase contract can be rescinded through the agreed process.

If a supported dwelling remains unsold by the nominated date, Keystart purchases it under the agreed terms. The purchase price incorporates a minimum discount to market value of 10% in metropolitan areas or 7.5% in regional WA.

TO QUALIFY

Key project criteria include:

• A location in Western Australia, with planning and development approvals in place.

• At least 10 dwellings in metropolitan areas or four in regional areas.

• The ability to achieve substantial commencement within 6 months.

• An indicative lender term sheet identifying pre-sales as a condition of finance.

• A portion of homes valued within Keystart’s applicable low deposit home loan price limits.

Other requirements apply, and participation remains subject to Keystart’s assessment and approval. Application and establishment fees apply, with legal and valuation costs also potentially payable.

CONSTRUCTION FINANCE

The scheme provides purchase commitments to support access to construction finance. Developers still need a construction facility and their own equity contribution, and their lender must agree to recognise Keystart’s commitments towards its pre-sale conditions.

From a financing perspective, I would also assess:

• Whether the value recognised by the lender closes the project’s pre-sale shortfall.

• How discounted sale proceeds and scheme costs affect debt repayment and the development margin.

• Whether the agreed settlement timing aligns with the loan term.

• What other funding conditions must be satisfied before construction can commence.

For eligible projects, the scheme could provide a valuable pathway to an earlier start, provided the commitments work alongside the broader funding structure.

Are pre-sale requirements delaying your project?

Contact Zaya Capital + Finance to discuss your funding requirements and whether the Pre-sale Guarantee could form part of a suitable construction finance solution.