Will NSW’s $1 Billion Guarantee Spark a Sydney Apartment Boom?

The NSW Government has just launched a $1 billion Pre-Sale Finance Guarantee and it could have a big impact on how quickly new apartment projects get off the ground in Sydney (at least that's the hope).

At its heart, the scheme is designed to tackle a long-standing problem, developers often struggle to secure finance unless they’ve pre-sold a large chunk of apartments off-the-plan. With the market as tough as it’s been, many approved projects have been sitting idle because those pre-sale targets are out of reach.

This new guarantee plans to change that equation.

How the Guarantee Works

Here’s the simple version:

• The government will back up to half the apartments in a project, up to $2 million each.

• That backing gives banks the confidence to lend, so developers can start building sooner.

• Projects must be ready to break ground within six months and meet strict quality checks through the Building Commissioner’s office.

• If the apartments do sell, the guarantee rolls forward to help another project. If they don’t, the government steps in and buys the unsold stock at a discount.

• It’s essentially a safety net for financiers and developers, one that could push stalled projects into construction.

Why This Matters for Sydney

Sydney has more than 13,000 homes approved but not yet built. That’s a huge amount of potential housing tied up in red tape, finance hurdles, and market uncertainty. Builders and developers are certainly welcoming the move, calling it a fast-lane to unlocking supply.

If the guarantee works as intended, we could see:

• Faster delivery of new apartments and fewer projects stuck on paper.

• More competition in the market which might help ease price and rental pressures.

• Opportunities for smaller or mid-tier developers who were previously locked out.

What Owners and Strata Communities Should Watch

For strata communities, the arrival of more new apartments in Sydney will bring both opportunities and challenges. More schemes coming online means additional buildings to manage, new committees to form, and increased competition between older and newer stock. While faster project delivery is positive, it also raises concerns around build quality and defects, making the Building Commissioner’s oversight especially important. For existing owners, nearby developments may place pressure on rents and resale values of older apartments, but they can also enhance the appeal of a neighbourhood by introducing improved infrastructure, services, and amenities.

While the scheme is bold, it doesn’t fix everything. Construction costs are still high, planning processes can still be slow, and some locations may struggle with oversupply. There’s also the question of what happens if the government ends up holding a large portfolio of unsold units. Still, as a circuit-breaker for a system that’s been gridlocked, this could make a real difference.

From a strata perspective, the Pre-Sale Finance Guarantee could reshape Sydney’s apartment landscape over the next five years. Generally, more buildings coming into the market is a positive for the sector, not only creating growth opportunities but also giving more people the chance to realise their property ownership dream. More supply will mean new communities forming, new schemes to manage, and a larger role for strata professionals in supporting both owners and residents. While a quality build is always essential, and the Building Commission's strong oversight will play a pivital role here, the ongoing expert management of a building is just as important. At the end of the day, having a team, like Compass Strata, that genuinely cares about the community and the building itself is what will make the biggest difference to the overall well-being of the place and the long-term value of your investment.