Land rent scheme collapses as predicted

johnboy 23 February 2009 23

Zed Seselja is dancing on the grave of Jon Stanhope’s vaunted land rent scheme that was supposed to help housing affordability.

As predicted lenders wouldn’t have a bar of it leaving the scheme available only to low income earners with enough money sitting around to self-finance construction.

Unsurprisingly the number of people in that situation has turned out to be zero.

Spare a thought for the poor buggers, silly enough to think a cunning plan of the Stanhope Government would have been fully thought through, who are seriously out of pocket for daring to trust.

    “This has left many innocent parties, who trusted their government, in a position where not only have their dreams of home ownership been dashed but they are also facing substantial bills for solicitor’s fees and deposits. One family told me that they have spent $1000 in solicitor’s fees, and they are locked into a contract, yet they cannot get finance.

UPDATED: In the absence of any official statement from the Chief Minister Zed’s following up and we’ll have to go with his version of events for now.

Apparently the Chief Minister did see his way clear to setting straight the 2CC audience:

    “This notion of ‘they’re out of pocket. It’s costing them’ That’s just not true. It’s bulldust.”

Zed is sticking to his guns and asking for compensation for his constituents who are claiming to be in a whole.

Or maybe if Mr Stanhope is so sure this is still a good idea he can set up an ACT Government funded scheme to loan construction money to land renters?


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23 Responses to Land rent scheme collapses as predicted
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toriness toriness 3:12 pm 24 Feb 09

sorry sepi but i think the leap from a person relying on the government providing crisis accommodation (definitely a role for government) to the government helping that person own their own home is too big a leap. what you’re really talking about is government housing provided at a nominal rent (not market rate) to people who can’t even afford normal market rent nonetheless mortgage repayments.

poptop poptop 2:43 pm 24 Feb 09

Not quite sepi. The Age Pension is only sufficient to live on if you own a place to live.

Rent on the pension doesn’t go.

sepi sepi 1:00 pm 24 Feb 09

I think it makes sense for govts to want people to own their homes – it makes for less pensioners and struggling families relying on govvie housing, or needing crisis accomodation.

caf caf 10:20 am 24 Feb 09

During most of the 20th century it was seen as politically useful to encourage widespread home ownership, as a way of wedding more people to private property and thus building up resistance to communist ideas.

OzChick OzChick 9:23 am 24 Feb 09

^ The rate of stamp duty for residential property has not changed since 2002. It is not that, that has jumped it is property prices.

VYBerlinaV8_the_one_they_all_copy VYBerlinaV8_the_one_they_all_copy 9:22 am 24 Feb 09

Good posts toriness. This idea that home ownership is some sort of right is simply bizarre.

toriness toriness 7:35 am 24 Feb 09

and by that i mean i know people think people who already own a home have a vested interested in property prices going up, but i think that’s a simplistic view. what about if i want to sell my residence and move to another – let’s not forget how much stamp duty has jumped with booming property prices!

toriness toriness 7:15 am 24 Feb 09

not everyone can afford to own their own home. it is as simple as that. nor it is a right to own your own home either. it is government’s business to ensure, to best endeavours, that all citizens have access to a roof over their heads – but not to own that roof. i wish government would stop interfering in the property market – it just messes with the prices and makes it harder, not easier – and i say this as someone who owns my own home plus another.

djk djk 11:01 pm 23 Feb 09

OzChick said :

LDA won’t offer a Land Rent lease contract unless you have attended an information session about Land Rent at CIT. So you can’t really just walk into LDA and sign one of these contracts without going obtaining a CIT certificate to verify this. Anyone who would have entered into such a contract would have been advised to seek legal advice at the information session.

The same course that doesnt even mention the fact that you will be more or less buying a depreciating asset, while the goverment will own the asset that actually increases in value?

sepi sepi 10:08 pm 23 Feb 09

If they are really keen to help out low income earners, why not bring back low interest loans to buy govvie houses?

Deckard Deckard 9:21 pm 23 Feb 09

and the word of the week is….

Bulldust

cranky cranky 8:34 pm 23 Feb 09

Back in the 60’s, the land allocation system was a bit diferent. You went to an auction, usually for a whole suburb.

A mate bought a block in ‘upper’Cook for $35.00. Total price, no more to pay.

No subsidies any more, but I’d bet Sonic and Co are making a pretty profit (plus stamp duty) on current land releases.

OzChick OzChick 8:08 pm 23 Feb 09

LDA won’t offer a Land Rent lease contract unless you have attended an information session about Land Rent at CIT. So you can’t really just walk into LDA and sign one of these contracts without going obtaining a CIT certificate to verify this. Anyone who would have entered into such a contract would have been advised to seek legal advice at the information session.

VYBerlinaV8_the_one_they_all_copy VYBerlinaV8_the_one_they_all_copy 7:21 pm 23 Feb 09

Well, some people sign contracts prior to getting a conveyancer to look over the contract.

…and some people a morons – next!

Unless these people are lawyers themselves, this is the height of stupidity.

Mr Evil Mr Evil 6:44 pm 23 Feb 09

And here I was thinking that the NSW Govt was starting to make the ACT Govt look professional!

Good on you Stanhope: another own goal that ACT taxpayers will no doubt be forced to pay for.

djk djk 5:03 pm 23 Feb 09

caf said :

What cowboy solicitor allowed their clients to sign a contract without finance approval??

Sometimes against their solicitor’s strong advice to the contrary, clients choose to do something silly..?

jakez jakez 2:22 pm 23 Feb 09

“I call on Mr Stanhope to accept responsibility for the failures of this scheme, to apologise to those he has misled and to give compensation those who are out of pocket,” said Zed.

Will it really be Stanhope giving compensation? Will his paypacket be garnished? Will it be his staffers? What about the public servants that gave this policy their approval?

No it won’t be any of those people. It will be the innocent taxpayer that has to pay.

miz miz 1:28 pm 23 Feb 09

Better idea: offer a fixed low interest loan to low income earners. This was how my parents bought their government-built house in Canberra in the 1960s/70s.

OzChick OzChick 12:12 pm 23 Feb 09

wishuwell said :

Question please. If the land is rented does that mean that rates cannot be charged for the unimproved value of the block?

From the ACT Revenue website: “the lessee will be liable to duty on the grant of the land rent lease, rates, and, if applicable, land tax.”

http://www.revenue.act.gov.au/home_buyer_assistance_mp/5

tylersmayhem tylersmayhem 12:07 pm 23 Feb 09

Well, some people sign contracts prior to getting a conveyancer to look over the contract.

…and some people a morons – next!

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