Is it bad to buy house on leased land in Australia and UK, it has disadvantages but not necessarily bad if lease long and cheap, with pros cheaper purchase price and cons ground rent, limited control and financing difficulty. Buying house on leased land, such as ACT 99 year Crown lease, or UK leasehold houses with ground rent $200 to $500 per year and service charges, has disadvantages including ground rent increasing, lease length decreasing with value dropping after 80 years, costing $10K to $30K to extend, difficulty getting mortgage if lease under 70 years, restrictions on renovations and subletting requiring permission $100 to $500, and risk of forfeiture if ground rent not paid, though rare. Advantages include cheaper upfront price $50K to $100K less than freehold, with $500K freehold versus $400K leasehold for same house, and lower land tax in ACT. For example, in ACT all houses on 99 year Crown lease, not bad as lease renewable and ground rent nominal $20 per year, so buying house on leased land not bad. In UK, leasehold houses with high ground rent doubling every 10 years are bad, with many new builds with ground rent $250 doubling to $500, making it bad investment. So buying house on leased land not bad if lease long 99+ years, ground rent low $20 to $200 and renewable, as in ACT, but bad if lease short under 80 years, ground rent high and doubling, as in some UK leasehold houses, with extra costs $10K to $30K for extension and financing difficulty.
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