LEASE PURPOSE CLAUSE (ACT)

Land is owned in the ACT it is by way of a long term (usually 99 years) lease from the ACT Government. The initial sale price from the Government is determined by its allowable use. For example, a block for a single residential house. This use is stated in the lease purpose clause of the crown lease. Therefore, if the owner wishes to vary that use upwards, for example, to build 2 houses (dual occupancy) instead of the allowable use, he/she must have the lease purpose clause varied to allow the higher use. In this case there will be a change of use charge as the land is more valuable than after the change of use than it was before.