Rural landlords are offering cripplingly low security of tenure

The Tenant Farmers Association (TFA) has reacted with dismay at newly released figures showing that security of tenure on agricultural tenancies continues to be in decline.

Statistics released this month by the Central Association of Agricultural Valuers (CAAV) in its annual Agricultural Land Occupation Survey, show yet another worrying decrease in security of farm tenure in 2018 in comparison to the previous year.

The short-term nature of agricultural tenancies is crippling progression, investment, sustainable land use and productivity on farms. With much higher demand for farm land than supply, landlords can offer short-terms, for high rents at very little risk, whilst at the same time pocketing generous and unconstrained tax benefits, which the TFA argues must be addressed.

The CAAV figures report that the average length of term on all FBTs has decreased from what was already a low point in 2017 of just under four years, to below three years in 2018. Excluding lettings of less than a year, the average tenancy length has plunged from just below five years to four years overall.

Most worryingly, fully equipped holdings, which would be expected to be let for longer terms, have seen a reduction to just seven and half years in 2018, slashing by half the length of term seen two years previously.

It is simply unacceptable that 90% of farm tenancies let in 2018 had terms of five years or under, and that 63% of all new lets are offered on the most insecure terms –for less than two years.

TFA Chief Executive, George Dunn, said “These statistics are simply dreadful. Everyone agrees that long-term relationships are the best way to achieve positive outcomes for landlords and tenants. Yet, the market is failing to deliver efficient or sustainable outcomes, in fact, it is going backwards. It is now urgent that the Government steps in to address this major market failure, in a sector that makes up one third of all UK farmland and where FBTs represent about half that area. The best way to do this would be through the taxation environment within which rural landlords make decisions about letting land to encourage longer term FBTs. However, with the Government cancelling next week’s Budget, another opportunity to change this terrible situation will be missed.”

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About The Author

John Swire - Deputy editor of Agronomist and Arable Farmer as well as responsibility for the Agronomist and Arable Farmer and Farm Business websites. After 17 years milking cows on the family farm John started writing about agriculture in 1998 and has since written for a variety of publications and has developed a wide circle of contacts within the industry. When not working John is a season ticket holder at Stoke City and also of late has become a fitness freak, listing cycling, swimming and walking as his exercises of choice.