When homeowners first hear about the Buy My Backyard model, the most common initial question is: "What's the difference between this and just renting out a granny flat normally?"
It's a fair question. Both arrangements involve a secondary dwelling on your land, and both generate rental income. But the legal structure, the income security, the obligations of both parties, and the long-term implications are fundamentally different.
A standard residential rental is governed by the Residential Tenancies Act in your state. The tenant rents the dwelling — the physical building — from the owner. Key characteristics:
As a landlord renting a granny flat on a standard residential tenancy, you will experience:
Standard rental income is real and can be meaningful — but it is not passive and it is not stable in the way long-term lease income is.
A 99-year land lease is a formally registered legal instrument. The tenant leases a defined portion of land — not just the dwelling that sits on it — for up to 99 years. Key characteristics:
Under a 99-year land lease:
| Standard Rental | 99-Year Land Lease | |
|---|---|---|
| What is leased | The dwelling | Defined portion of land |
| Term | 6–12 months, periodic | Up to 99 years |
| Registered on title | No | Yes |
| Tenant security of tenure | Low | Very high |
| Income stability | Moderate (vacancies, fluctuations) | High (term, review provisions) |
| Active management | Required | Minimal once established |
| Legislation | Residential Tenancies Act | Long-term lease legislation |
| Transferable on property sale | No (ends with lease) | Yes (transfers with title) |
| CGT implications on setup | None | Seek tax advice |
| Income on property sale | Ends | Transfers to new owner |
For homeowners whose primary goal is stable, ongoing income from their land — the 99-year land lease structure is significantly more robust than a standard rental arrangement.
The long-term lease removes the income uncertainty that comes with tenant turnover, vacancy periods, and short-term lease renewals. The formally registered nature of the arrangement provides legal protection for the income stream that a standard tenancy does not.
If you want maximum flexibility — the ability to end the tenancy quickly, use the space yourself, or redevelop freely — a standard rental provides more short-term control.
A 99-year lease is, by design, a long-term commitment. The tenant has significant legal rights under the lease, and ending it early requires either agreement of both parties or a specific breach provision. This is what makes it attractive to tenants — and what makes the income stable for you.
Yes — and we actively encourage it. A 99-year land lease is a significant legal document. Before executing the lease, you should have it reviewed by an independent solicitor who can advise on:
Buy My Backyard will provide you with a draft lease well in advance of execution and will pause the process to allow adequate time for legal review.
If you're considering generating income from a secondary dwelling on your land — whether through a standard rental or a 99-year lease — the free property assessment is the first step. We'll assess whether your property qualifies for the Buy My Backyard programme and give you a clear picture of what the income potential looks like for your specific backyard.
No cost. No commitment. 48-hour response.
This article provides general information only and does not constitute legal or financial advice. Lease arrangements vary by state legislation and individual circumstances. Always seek independent legal advice before entering a long-term lease.
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