Development Finance

Development finance provides funding for property construction or renovation projects. Unlike standard loans, funds are drawn down progressively as construction milestones are reached. Interest is typically capitalised (added to the loan) during construction and the full loan is repaid upon project completion or refinance.

Development finance LVRs typically range from 65-80% of the total development cost (TDC) or end value. Most lenders cap at 70% of TDC for residential developments. Higher LVRs may be available for experienced developers with pre-sales.

Key requirements include DA (Development Approval) or CC (Construction Certificate), detailed cost estimates from a quantity surveyor, builder quotes, pre-sale contracts (for larger projects), a feasibility study showing profit margin (typically 15-20%+), and your development experience.