The Tenant Farmers Association (TFA) is calling for a greater degree of realism from landlords of farmland and their agents when approaching new Farm Business Tenancies (FBTs).
UK agriculture is about to face the prospect of trading under World Trade Organization (WTO) rules, having had over 40 years as part of the EU customs union and single market.
At the same time, in England, the government will trigger the start of a transition away from current agricultural support schemes.
The business environment within which agriculture operates is about to get a lot more challenging and landlords and their agents need to wake up to these changes.
TFA chief executive, George Dunn, said:
“The modus operandi of a significant number of agents acting for landlords is to use short lengths of term and threats of remarketing, to offer FBT agreements on very restrictive terms at unsustainable levels of rent.
Landlords would be better placed to instruct their agents to make long-term agreements with tenants with more flexibility and at sensible levels of rent.
“Such agreements would provide both a sustainable return to landlords and a good platform for the business success of the tenant.”
There is little scope for tenants
With the average length of term for new FBTs now below four years and with 90% of all new FBTs let for five years or less, there is little scope or realism for tenants to be able to invest on a sensible basis or consider entering new public payments for public good schemes.
Many tenancy agreements also preclude tenants from participating in such schemes without the consent of their landlords.
“A generation of landlords’ agents has been schooled by some of the leading, national firms of agents to use FBTs to exact the maximum amount of leverage for the short-term benefit of their clients.
This seems to be a long way from the requirements of the Royal Charter of the RICS [Royal Institution of Chartered Surveyors] to ‘promote the usefulness of the profession for the public interest’.
“As we enter a new era for UK agriculture outside the rules, regulations and benefits of EU membership, we need landlords’ agents to show greater concern for issues impacting long-term sustainability than they have hitherto,” said Dunn.
