12 April 2007
LAND RENT SCHEME OPENS DOOR TO HOME OWNERSHIP
Potential home buyers will find it easier to enter the market, thanks to a new scheme that will allow them to buy their home while paying rent for the land on which it sits, Chief Minister Jon Stanhope announced today.
The scheme, unique to the ACT and possible thanks to the ACT’s leasehold system, is part of the Government’s Affordable Housing Action Plan.
“This option will greatly reduce the cost of home ownership for those wanting to enter the market,” Mr Stanhope said today. “Land rent payments would be about a quarter of the mortgage cost of buying a block, potentially reducing their housing costs by hundreds of dollars a week.
“With the introduction of the new affordable house and land packages announced as part of the Action Plan, these costs can be cut even further – bringing home ownership within the reach of many more households on low incomes.”
The Chief Minister said the rent could initially be set at a concessional rate calculated to cover the development and infrastructure costs. Owners would be able to purchase the land from the Government at any time as their circumstances improved. If homebuyers sold the house, the ACT Government would contract with the new owner to take over the land rental agreement or to purchase the land.
“This scheme takes advantage of the ACT’s land leasehold system, and makes buying a home a possibility for many people who may previously have felt it was out of their reach,” Mr Stanhope said. “Many first home buyers will be able to take advantage of the land rent option and buy a house for the same outgoings or less than it would cost them to rent an equivalent house.”
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