A townhouse construction loan funds the build of a multi-dwelling residential project at the smaller end of the development scale - typically two to ten dwellings on a single site, structured as community-title or strata-titled product. Funds are released progressively as the build moves through milestones, with each drawdown verified by quantity surveyor inspection before release.
Townhouse projects are the most common first development for many Australian property professionals - builders stepping into development, investors moving from single-property holding into small-scale construction, and family-owned property businesses scaling up. They're also the projects banks most frequently decline. Bank construction lending applies rigid criteria around developer track record, pre-sale thresholds (often above 50% of expected revenue), and minimum project sizes that simply don't fit a four-dwelling townhouse build. The result: viable projects with sound feasibility and credible builders stall for months waiting on bank credit committees that ultimately say no.
At CPF, townhouse construction finance is asset-led and project-led. Assessment focuses on the site, the development approval, the builder, the projected GRV of the completed dwellings, and a credible exit strategy - typically the staged sale of completed townhouses, a refinance to a longer-term facility, or progression to a CPF residual stock loan if some units remain unsold at the end. First-time developers are considered on the merits of the project, not penalised on track record alone.
Up to 65% GRV (up to 75% with second mortgage) Low or no pre-sale requirements First-time developers considered on the merits of the project Funds duplex through to ten-dwelling townhouse projects Capitalised interest - no monthly debt servicing during the build Staged drawdowns aligned with construction milestones Available to company and trust borrowers No brokerage clawbacks - broker commissions stay paid
Two-dwelling builds on a single site - the most common entry point to property development. Funded against completed value.
Boutique townhouse rows and small townhouse communities - project sizes that fall below most construction facility thresholds.
Builders new to development, investors moving into construction, family property businesses scaling up.
Single-storey villa rows, retiree-targeted small developments, and community-titled projects funded as a single facility.
Submit your project for assessment or speak with our team about townhouse construction finance for your next build.
Funding solutions designed for property developers, investors, and brokers across Australia.
