The Lease Variation Charge, and the missing middle remission

In most Australian jurisdictions, when a rezoning or a planning approval makes your land more valuable, you keep most of that gain. The ACT is different, and almost nobody models it.

Varying a Crown lease to permit more dwellings triggers the Lease Variation Charge. It is usually the single largest line in an ACT infill project — larger than the DA, larger than the holding cost, and payable to the Territory before a brick is laid. The codified schedule is deliberately calibrated to capture 75% of the value uplift. You keep 25%.

What it costs, by suburb

The charge is set per suburb, in a determination almost nobody reads. This is the codified charge for taking a block from one dwelling to two under DI2026-142, which commenced 1 July 2026 — and the payable column is what you actually hand over once the missing middle remission is applied.

The same statutory move, on the same zone, for the same second dwelling. Nothing about the block changes what is in that column; only the suburb does.

The commonest case by far is the second dwelling — what that costs, and what stops it, is dual occupancy on an RZ1 block. Two things follow from the table, and both catch people out. A cheap block in an expensive suburb carries an expensive charge, because the rate is struck against the suburb rather than against what you paid. And the charge is not a percentage of your purchase price, so a bargain does not come with a discount.

What the 75% means arithmetically

Because the charge is 75% of the uplift, the charge itself tells you what the Territory thinks the uplift is:

implied uplift = codified charge ÷ 0.75

This is the only estimate of development uplift available to you before you commission a valuation, and it is published, per suburb, per dwelling count. It is the single most useful thing in the whole ACT planning system for a buyer, and it is sitting in a determination that hardly anyone reads.

The missing middle remission (DI2026-143)

From the 2026-27 Budget, RZ1 and RZ2 developments may get a 50% remission of the codified charge — on five conditions, every one of which has to hold. Where they do, your cash cost halves; and because the uplift does not change, your share of the planning gain goes from 25% to 62.5%. That is a 2.5× improvement and it is the largest change to ACT development economics in years. It is also not an entitlement, and the conditions are below.

Every one of these must hold

The trap

Those last two are programme tests, and real ACT projects have taken four to five years from purchase to approval. If you buy in 2027 and run a normal timetable, you can miss the approval deadline without doing anything wrong. This tool asks you for your expected approval and completion years and tests them rather than assuming you will make it — and the Pattern Book is the most reliable way to take the DA off the critical path entirely.

The commitment test bites in a place nobody expects: a block whose charge was already paid or deferred has burned the remission permanently, so a site sold with an older approval can be worth less than an identical one with none.

The modelling subtlety

Keep two numbers, always. The codified charge drives the uplift. The payable charge drives your cashflow. Substituting one for the other halves your implied land value and makes the screen produce nonsense. A policy concession does not make the land less valuable — it makes it cheaper to unlock.

Where it compounds

The remission halves the charge you pay. It does not change the rate you are charged at, which is selected by the total dwelling count — and the count is constrained by the site. Building a site out of several blocks attacks the other half: a larger total selects a lower per-dwelling rate in Schedule 2, and the remission then halves that. Both work in RZ1 and RZ2, which is the same ground the remission covers.

How much is the Lease Variation Charge in Canberra?

It depends entirely on the suburb. Under DI2026-142 the codified charge for taking a block from one dwelling to two ranges from $52,500 in Greenway to $346,000 in Forrest, with a median around $90,000 across the 105 suburbs the determination prices. In RZ1 and RZ2 the missing middle remission halves whatever that figure is until 2029.

Do I have to pay the Lease Variation Charge for a granny flat?

A secondary residence that does not vary the lease to permit an additional dwelling does not trigger the charge. Varying the lease so the block permits two separately saleable dwellings does. The distinction is what the Crown lease says, not what the building looks like — see reading a Crown lease purpose clause.

Is the Lease Variation Charge based on what I paid for the block?

No. The codified charge is set per suburb and per dwelling count in the determination, and it is struck against the uplift the variation creates rather than against your purchase price. Paying under the odds for a block does not reduce the charge, and paying over does not increase it.

When does the missing middle remission end?

The DA must be approved by 30 June 2029 and all dwellings constructed by 31 December 2030. Both are programme tests rather than application dates, so a normal ACT timetable started too late can miss them without anything going wrong.