Further education funding body The Learning and Skills Council last week agreed in principle to grant £17.3 million to the college to help the specialist training centre redevelop its main campus in Bircham Newton, Norfolk.
But the money is dependent on the college raising £4.3 million on its own.
It has already made £2.2 million by selling Hyde Close, a residential area next to the college, and says it can save a further £600,000 maintenance and -college running costs.
To raise the remaining £1.5 million, ConstructionSkills has submitted a planning application for 24 homes. This will be heard by King's Lynn and West Norfolk Borough Council on November 5.
If the application is successful, the college will get the go-ahead for its redevelopment plans.
These include 120 ensuite rooms for students, a new sports hall and leisure facilities, catering facilities, a computer suite, library, and new offices.
But NCC commercial manager Andy Walder said plans would have to be scaled back if the planning application was unsuccessful.
He said: "If we don't get the money, we would have to revise the scheme accordingly."
A poll of local residents last year found that three-quarters approved the development plans.
The NCC's previous application for 250 homes was rejected earlier this year because the Department for Communities and Local Government said the housing did not conform to the council's local development plan.
An LSC spokesman said: "The LSC normally expects its providers to make a contribution for any funding.
"We would need to make an assessment if the planning application is unsuccessful."
The funding would mean the college will come under the umbrella of the National Skills Academy for Construction.
The NCC has historically only had access to higher education funding but it now qualifies for further education money.
As a result, the college will have to offer more on-site training to apprentices.
Mr Walder added: "We have had to change our mentality over the past few months. We have now gained access to further education funds, from which we were traditionally excluded because of the specialist nature of our teaching."
The NCC would retain training for tower cranes, heavy plant and civil engineering, but would lose its light plant, groundworks and some of its scaffolding training.
As a result, ConstructionSkills is in negotiations to extend its scaffolding training to its sites in Erith, Kent, and Birmingham.
Previously it was estimated that around 50 of the 700 staff at the college would lose their jobs. But Mr Walder said these would be saved if the funding was secured.