Metrics
Profit on cost, what it is and how to use it
Formula
Profit on cost = (Net realisation − TDC) / TDC. Net realisation is GRV minus selling costs and GST. TDC is all-in cost.
Typical hurdles
18–22% is the conventional minimum for a build-to-sell apartment in Australia. Larger projects with longer programs need 20–25% to compensate for risk. Lenders and equity partners often have their own thresholds.
vs development margin
Profit on cost measures capital efficiency. Development margin measures pricing power. ICs want both above their hurdle.
About this article
Published May 2026. Written by Popurise for Australian property developers.
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Cross-reference
Related models, use cases and definitions.
Glossary