Almost 650 new homes planned for Rhodes and Auburn are expected to move closer to construction after receiving support through the NSW Government’s $1 billion Pre-sale Finance Guarantee.
The government has agreed to provide pre-sale commitments for 34 apartments within the Rhodes Bay development and 30 apartments at North Village in Auburn.
The commitments are intended to help the developers satisfy commercial lenders’ pre-sale requirements and secure the finance needed to begin construction.
The announcement does not mean the NSW Government is directly funding the entire cost of either development or immediately purchasing all 64 apartments.
More than 400 homes planned at Rhodes Bay
Rhodes Bay is an $834 million State Significant Development planned within the Rhodes urban renewal precinct.
The project will deliver more than 400 apartments, including 68 affordable homes intended for low- to moderate-income households.
Under the guarantee program, the NSW Government has agreed to underwrite the pre-sale of 34 apartments within the development.
This commitment will count towards the level of pre-sales required by the project’s lender, reducing the financing gap that has prevented some approved residential developments from moving into construction.
The government has not yet publicly confirmed a construction commencement date for Rhodes Bay as part of the latest announcement.
Auburn project to deliver 249 homes
The $223 million North Village development is planned for the Auburn Square precinct and will provide 249 new apartments.
The government has offered pre-sale support for 30 of those homes.
The NSW Planning Department’s program register lists the Auburn project as having accepted an offer worth approximately $24.86 million.
The development is intended to create a mixed-use, walkable neighbourhood close to Auburn’s public transport, shops, services and employment opportunities.
Further contractual and financing steps may still be required before major construction begins.
How the guarantee works
Many apartment developments require a certain proportion of homes to be sold off the plan before banks will release construction funding.
When market conditions make it difficult to achieve enough early sales, a project may remain unbuilt despite holding planning approval.
Under the Pre-sale Finance Guarantee, the NSW Government makes a legally documented commitment to acquire selected dwellings if they remain unsold when construction is completed.
That commitment can be treated by a participating lender as an eligible pre-sale, allowing the developer to meet its financing conditions and draw down construction funding.
For qualifying developments with more than 20 homes, the government can generally commit to purchasing up to 50 per cent of the dwellings, with support capped at $50 million per project.
Individual homes must generally have a guarantee value of no more than $2 million, or $2.5 million for properties containing three or more bedrooms.
Developments must already hold the necessary planning approvals and be capable of substantially commencing construction within six months of entering formal contracts.
Government may never purchase the homes
The guarantee does not necessarily result in the government becoming the final owner of the supported apartments.
Developers remain able to sell the underwritten dwellings to private purchasers at market value and cancel the corresponding government commitments, subject to their lender’s approval.
The program expects most supported properties to be privately sold before or around the time construction is completed.
Only when an underwritten dwelling remains unsold and is ready for occupation would the government be required to complete the purchase.
For most private developments, the government’s agreed acquisition price must be at least 10 per cent below the independently assessed market value.
The discount is intended to limit taxpayer exposure while encouraging developers to continue seeking private buyers.
The government does not pay an upfront deposit and says the program does not transfer normal construction and development risks from the developer to the state.
More than 1,200 homes supported
With the addition of the Rhodes and Auburn developments, the NSW Government says the program has helped accelerate the planned delivery of more than 1,200 homes across metropolitan and regional NSW.
Existing supported projects include developments in Rozelle, Pyrmont, Westmead and Orange.
However, projects within the program are at different stages. Some have commenced construction, while others remain at the contract, offer or pre-construction stage.
The $1 billion program operates as a revolving fund, meaning commitments can return to the available pool when supported apartments are sold privately and the guarantees are cancelled.
The scheme is expected to operate over five years and has since influenced similar housing finance programs in South Australia and Western Australia.
Program expanded to affordable and regional housing
The NSW Government expanded the program in June 2026 to improve access for smaller projects, regional developments and registered not-for-profit community housing providers.
Projects now need to contain at least four homes, replacing the previous minimum financial threshold.
Developments with fewer than 20 homes may receive guarantees covering up to 75 per cent of their dwellings, capped at $30 million per project.
Registered not-for-profit community housing providers may receive support covering all affordable homes within an eligible project, also subject to a $30 million project cap.
Up to $80 million of the program’s capacity can be allocated to community housing provider projects at any one time.
Approval is not a project warranty
The NSW Government states that acceptance into the Pre-sale Finance Guarantee should not be interpreted as a government partnership, endorsement or warranty of a development.
Officials assess the developer’s capability, financial capacity, delivery team and project readiness before offering support.
However, the government does not guarantee construction quality, completion dates, investment returns or the broader financial performance of a supported project.
For Rhodes Bay and North Village, the immediate significance of the announcement is that government-backed pre-sales may help unlock private construction finance.
Whether the developments move rapidly onto site will now depend on the completion of financing, contractual and construction-readiness requirements.
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