A bold bid to accelerate housing supply
In one of the most significant housing policy announcements ahead of the March 2026 South Australian election, Premier Peter Malinauskas has pledged to establish a $500 million Pre-Sale Guarantee Fund aimed at unlocking stalled apartment projects in the Adelaide CBD.
The initiative, if re-elected, would see the South Australian Government act as guarantor on up to 50 per cent of dwellings in eligible off-the-plan apartment developments, capped at $30 million per project.
For developers, the fund could be the missing piece in getting shovel-ready projects out of the ground, providing the pre-sales assurance banks demand before releasing finance.
Why the policy matters
While planning approvals for higher-density housing in South Australia have risen, many projects have failed to proceed to construction. In the past decade, 2,414 apartments were approved in the Adelaide CBD but never commenced.
Industry observers point to one key reason: the gap between demand and pre-sales targets set by financiers. With rising construction costs and tighter credit, many otherwise viable projects stall at the funding stage.
The new guarantee fund directly targets that barrier, giving lenders confidence that projects will reach completion and giving buyers confidence their apartments will actually be built.
How the fund works
Under the proposal, developers must meet strict criteria:
- Planning approval already secured
- Proven track record in delivering apartment projects
- Financially sound balance sheet
- Ready to commence construction within six months of approval
Successful applicants would pay a $50,000 establishment fee plus an annual facility fee of 1 per cent on the guaranteed value.
In return, the government would guarantee up to half of unsold apartments. If any dwellings remain unsold at completion, the developer could trigger the guarantee and the government would purchase those apartments at a 10 per cent discount to market value.
Lessons from past projects
The concept isn’t entirely new to South Australia. The Nightingale Bowden development previously received a government underwrite through Renewal SA, helping it proceed at a critical stage. In that case, every apartment was sold privately without the guarantee ever being called upon.
By formalising the approach through a $500 million fund, the Malinauskas Government hopes to replicate that success across multiple projects, stimulating both housing supply and construction jobs.
A surge in demand and momentum
Premier Malinauskas said the initiative complements his broader housing roadmap, launched just over a year ago.
“Adelaide is growing out and up,” he said.
“While we continue to deliver land releases and water infrastructure for more homes on bigger blocks, we’re also accelerating options for well-priced medium and high-density living in our city.
Our policy is all about giving people choice.”
Latest ABS data shows record levels of housing activity in South Australia:
- 12,692 homes completed in 2024–25 the highest ever
- 14,311 homes under construction, excluding the pandemic-era HomeBuilder spike
That momentum, Malinauskas argues, gives the state a strong foundation for further urban renewal.
Industry welcomes the move
The Property Council of Australia’s SA Division has strongly backed the plan. Executive Director Bruce Djite called it a “significant step in tackling the housing crisis”.
“We applaud the Malinauskas Government for listening to industry and taking action. Our election platform called for this exact initiative, and we welcome the Premier’s speed in committing to it,” Djite said.
He also urged the policy to expand beyond the CBD.
“It’s critical that this underwrite extends to the corridors identified in the Greater Adelaide Regional Plan to deliver the best housing outcomes and the best bang for buck.”
A builder’s perspective
For builders and developers on the ground, the fund could mean the difference between holding pattern and progress. By removing uncertainty, more projects could move to tender, keeping subcontractors and suppliers in work and supporting the broader ecosystem.
Nick Champion, Minister for Housing and Urban Development, said the guarantee was designed to give confidence to both banks and buyers.
“Having the Government act as guarantor will give financiers the assurance they need to back more housing projects in our city,” Champion said.
“First-home buyers can now sign a contract knowing their apartment build will proceed quickly.”
Guardrails and accountability
To safeguard taxpayers, the government has built in several checks.
- Strict developer vetting
- Defined eligibility windows
- Annual fee structure to offset risk
- Government purchase only as a last resort and at a discount
Targeted industry consultation will be undertaken before the scheme is finalised, focusing on parameters, eligibility, and fee structures.
Broader strategy: growing up as well as out
The $500 million fund sits within a broader policy push to increase density in strategic locations while maintaining the state’s strong pipeline of greenfield land.
Through its Housing Roadmap, the government is investing in:
- Urban renewal projects that repurpose underused sites
- Public housing growth – the first net increase in a generation
- Critical infrastructure like water and transport, enabling new development corridors
Together, these initiatives aim to diversify South Australia’s housing stock and support the construction industry at every level.
What it means for the industry
For builders, this could open up a new wave of opportunities across design, delivery, and subcontracting. Developers will be able to advance projects previously shelved due to pre-sale shortfalls.
And for home buyers particularly first-timers the policy promises faster delivery of well-located, more affordable apartments in the heart of Adelaide.
If executed effectively, the Pre-Sale Guarantee Fund could become a national case study in how targeted government backing can unlock private investment while protecting public funds.
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