Farm rent review dam ready to burst

The Tenant Farmers Association believes if current economic conditions prevail, it is only a matter of time before we see a flood of farm rent reductions in England and Wales.

TFA Chief Executive George Dunn said “Some landlords’ agents are using increasingly desperate tactics to shore up defences against reasonable demands for rent reductions from tenant farmers and the pressure against them is building. We have already seen a trickle of rent reductions, both for secure tenancies under the Agricultural Holdings Act 1986 and on Farm Business Tenancies, which are beginning to support the significant amount of existing budgetary evidence pointing to the need for reductions”.

“Speaking to many tenants around the country, I understand a big concern is the potential level of costs involved in dealing with a rent review. With professional time now routinely charged in hundreds of pounds per hour it doesn’t take many hours before a significant bill can be ratcheted up. However, there are many ways in which tenants can mitigate their cost liability,” said Mr Dunn.

“Many tenants are well able to argue their own cases on rent with a little bit of help, advice and support either from their agent in the background or from the TFA. In some cases tenants can insure against the costs of going to arbitration when their landlords pursue unreasonable cases. Even at the point of applying for an arbitrator when no agreement is reached by the term date, costs can be mitigated by making the application for the arbitrator’s appointment but then, in agreement with the other side, asking for the appointment to be put on hold as negotiations continue,” said Mr Dunn.

“The important thing is that tenants keep up the pressure as we head towards Lady Day reviews in late March or early April depending on where in the country they are. In the current climate, we would urge all farm tenants to consider serving rent review notices to keep options open for next year even as negotiations continue to agree rents for this year. The more notices served by tenants the greater momentum there will be for rents to fall,” said Mr Dunn.

“Rent reviews can be an incredibly stressful time for farm tenants and the TFA would urge all landlords to ensure that their agents are not acting flippantly, aggressively or unreasonably. Sensible settlements can be reached when both parties are prepared to negotiate from a reasonable basis,” said Mr Dunn.

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