diff --git a/cabal-install/src/Distribution/Client/ProjectPlanning.hs b/cabal-install/src/Distribution/Client/ProjectPlanning.hs
index ab673e5ba0f..2f0d79c9284 100644
--- a/cabal-install/src/Distribution/Client/ProjectPlanning.hs
+++ b/cabal-install/src/Distribution/Client/ProjectPlanning.hs
@@ -332,10 +332,10 @@ rebuildProjectConfig verbosity
                        fileMonitorProjectConfigKey -- todo check deps too?
       $ do
           liftIO $ info verbosity "Project settings changed, reconfiguring..."
-          liftIO $ createDirectoryIfMissingVerbose verbosity True distProjectCacheDirectory
           projectConfigSkeleton <- phaseReadProjectConfig
-          -- have to create the cache directory before configuring the compiler
           let fetchCompiler = do
+                 -- have to create the cache directory before configuring the compiler
+                 liftIO $ createDirectoryIfMissingVerbose verbosity True distProjectCacheDirectory
                  (compiler, Platform arch os, _) <- configureCompiler verbosity distDirLayout ((fst $ PD.ignoreConditions projectConfigSkeleton) <> cliConfig)
                  pure (os, arch, compilerInfo compiler)
 
diff --git a/changelog.d/pr-8358 b/changelog.d/pr-8358
index 928ff1dd043..ef1afa7e3b9 100644
--- a/changelog.d/pr-8358
+++ b/changelog.d/pr-8358
@@ -1,7 +1,7 @@
 synopsis: Update and sdist now only check for compiler when project file has conditionals
 packages: cabal-install
-prs: #8358
-issues: #8352
+prs: #8358 #8627
+issues: #8352 #8550 #8589
 
 description: {