Page 1574 - Week 05 - Thursday, 18 April 1991
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However, a further unspecified payment is required by the Executive for the grant of a further lease of the land. I believe that there are some problems there which need to be addressed by the Government when considering the ultimate Bill to be put before the Assembly.
A large number of submissions were received, not only for these committee deliberations but also in previous consultations in relation to this Bill. In relation to the question of renewal of leases, it is worthwhile to quote from evidence given before the committees on 4 April 1991 by the representative of the Master Builders' Construction and Housing Association (ACT). At page 185, he said:
There would be no residential owner in this town who could tolerate a position where they went to buy a house which had a 99-year lease and they were a first home buyer and therefore they were buying an old place that was a bit cheaper, and it had had perhaps 15 years to run on its lease, they clearly would not buy it if we did not know what would occur at the end of the remaining 16 years. The bank would not give them a security value. It would mean that old houses would just decay and sit there like rent control properties sat in the inner cities, like they sit in Harlem, they just become empty and they become dead properties.
And yet, knowing what the implications would be for residential property, we say, well, we are not going to do it, but we somehow think that the commercial property world is different, and we say that we will make the charge reasonable.
He went on to say, at page 186:
Now when we have old buildings, we often have a need for refurbishment, and if you have legislation which allows a percentage, and let us say it is a reasonable percentage, make it 10 per cent, very reasonable, but it is a percentage. Any Government at the stroke of a pen can change that percentage. So when the bank looks at a security which might have 15 years to run, it can't place any value on it because how do you know what Government will be in power in 15 years time.
Further, he went on to say, on page 186:
Unless we create an atmosphere where commercial land is the same in terms of security as residential land, you threaten the ability of the development industry and investment industry to get financial backing for facilities that are needed in Canberra. And I think the reason is simply that the world is a competitive place and
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