SMALL brick houses with no airconditioning, no fans and no landscaping are costing taxpayers $600,000 a pop to build in remote communities.

Kennedy MP Bob Katter has condemned recent federally-funded community housing "slapped up" on Mornington Island, saying it cost $4 million to build seven tiny homes that local contractors have since valued at being worth less than $300,000 each.

And the high building costs do not include the "hundreds of millions" blown on the government administration of community housing projects - all to provide indigenous communities with "substandard hot-boxes".

"The house I stood outside of was a hot-box that you couldn't even swing a cat in - it was a bloody disgrace," Mr Katter said.

"And they set the taxpayer back about $600,000 apiece."

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And indigenous mayors from the Cape met in Cairns yesterday to debate land leases tied to future funding.

The proposed 40-year lease system will see indigenous communities sign over their land in return for a share of more than $1 billion in social housing dollars in the next decade.

"To me, this is the Federal and State governments saying, 'We're going to give you a fair trial, then we're going to hang you'," Mr Katter said.

"They are telling these people they aren't capable of running their own affairs.

"When it (housing) was controlled by the council, they were getting 10 times as many houses built for infinitely less, but if you compare the (Federal Government controlled) Northern Territory to Yarrabah, then I think it will become clear who is doing the better job.

"This is just blood sucking for white fella bureaucrats."

The caucus of mayors, who labelled the 40-year-lease as ransom bargaining, unanimously called for the State Government to extend the December 11 deadline for four months to allow the communities to pursue their own legal advice in regards to the land sign-over bid.

"Communities are in dire need of housing, but the delivery should be one of consultations, not predetermined policy and those who must benefit most are those on the ground, not only for this generation but for the generations to come," Cherbourg Mayor Sam Murray said.

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