Mr Kefford was commenting as the ACT parliament prepares to finalise new rules this week that force Fluffy owners who buy their land back under the land-rent scheme to pay full market price, unlike others on land rent who pay unimproved value.

Ainslie homeowner Christina Pilkington is devastated by the change and by the price tag on her cleared block in Chisholm Street. The government paid Ms Pilkington $735,000 for her home under the buyback of asbestos contaminated homes in October 2014. A year later, it has valued the cleared land at $725,000.

Ms Pilkington wants to return to the block under the land-rent scheme, designed to help low income earners, but if she does, she will have to pay whatever the government determines to be market value at the point she can afford to buy it, which could be years in the future.

Mr Kefford said if Fluffy owners were allowed to buy their land at unimproved value it would open a loophole for some to make a windfall gain.

"If a couple earn $100,000 and they're an affected homeowner they would be able, unless this change is put in place, to take a first-right lease over their former block as a land rent lease.

"They could walk back in the next day and instead of paying the market value to acquire that block they could pay the unimproved land value. Which is, as I say, both an overall risk to the territory revenue as well as a significant inequity amongst the owners – because if they happen to earn $161,000 [the land rent cut-off], that would not be an option to them."

The government had been clear since the start that Fluffy owners would have to pay market value to get their land back, he said. They were getting first right of refusal on the blocks without having to compete at auction. But the scheme was also designed to recoup some of the huge cost.

"It's about providing assurance to the government and the rest of the community that is bearing the overall cost of the scheme that the land is being sold at market value, which has always been the government's intention."

There were fewer than 10 Fluffy owners looking at using land rent.

As to how Ms Pilkington's Ainslie land could be valued at almost the same as the value for the land plus a three-bedroom home just a year earlier, Mr Kefford said the valuations were separate processes. The selling price was determined by the Land Development Agency for what was a vacant block in an established suburb.

The government demolished 57 houses before Christmas but almost all of them are on blocks of 700 square metres or larger so are yet to be valued. The taskforce is waiting for a zone change to be finalised by the ACT parliament in the coming fortnight, allowing Fluffy blocks of 700 square metres to be developed as two separate titles. Mr Kefford said once that Territory Plan change was approved by the Assembly, auctions would begin, with the first expected in March or April.