Rent reviews produce steep rises
Rents reviewed by Smiths Gore on almost 300 traditional tenancies rose by 22% in the year to April 2013 to an average of £70/acre.
Across almost 200 Farm Business Tenancy (FBT) rent reviews by the firm in the same period, rents rose by 35% to £101/acre. Arable FBT rents reviewed topped the table at £134/acre, with dairy at £105/acre and livestock at £76/acre.
Rents for new FBTs – including new tenants and new tenancies with existing tenants – rose by 59% compared with the previous year.
The underlying profitability of land and relatively limited rental opportunities caused rents to soar, said Smiths Gore’s Agricultural Rent Survey. However, no more than the top third of dairy farmers were making sustainable profit margins.
Across all tenancy types, the eastern flank of Britain saw the greatest average increases. Reviewed rents across all farm types in the East Midlands and Yorkshire rose by 39% to £91/acre, while East Anglia and the South East saw reviewed rents rise by 38% to £106/acre.
More stories on farm finance