New code to help achieve fair farm rent reviews

Rent reviews for agricultural holdings should be conducted as a negotiation and not with a “take it or leave it” approach, says a new rent review code for Scotland.

Published by the tenant farming commissioner for Scotland, the Code of Practice on Conducting Rent Reviews is designed to help tenants and landlords reach agreement through transparent and objective consideration of all the relevant facts and circumstances.

It describes the legal basis for rent reviews and provides a practical, step-by-step approach to conducting a rent review. The code includes:

  • The key principles that should underpin a rent review
  • Relevant factors that should be considered in rent reviews, alongside those that should be disregarded
  • Guidelines on how to initiate and conduct a rent review
  • A suggested timetable for negotiations
  • Valid sources of evidence that should be used to underpin a review.

See also: How to resolve the top 8 farm tenancy issues

It also includes suggestions on how to resolve disagreements between the parties and how parties can make a complaint about breaches of the code.

Scotland’s tenant farming commissioner, Bob McIntosh, said: “If rent reviews are not handled appropriately they can become a source of dispute and disagreement, and can even permanently sour the relationship between landlord and tenant.

“At the end of the day, the aim is to determine the rent at which the holding might reasonably be expected to be let in the open market by a willing landlord to a willing tenant after taking account of certain factors.

“The new code offers a series of practical steps to follow, to ensure that rent reviews are evidence-based and conducted fairly to reach an outcome that’s reasonable to both parties.”

NFU Scotland (NFUS) president Andrew McCornick said: “The tenant farming commissioner continues to fulfil an essential role for the tenanted sector. 

“We welcome the work he has put in, alongside NFUS and other stakeholders to produce this latest code. I would urge tenants, landlords and agents to familiarise themselves with it, as the sector must take ownership for ongoing relations between tenants and landlords.” 

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