By Tim Relf
LANDLORDS and tenants could be at loggerheads this spring, with opinion split as to which way rent reviews will go.
“Rents must come down,” is the message from the Tenant Farmers Association. “Plenty of farmers are making no profit at all.”
Reg Haydon, national chairman of the Tenant Farmers Association, says output prices are 20-50% down on three seasons ago. “Farm incomes are at an all-time low. Landlords need to enter negotiations without any unrealistic expectations.”
Tenants on estates should work together because few landlords will want to go to arbitration to resolve disputes, he adds. “Theyll be on a hiding to nothing.”
Tenants, however, could gain from the process. Oswestry-based agent Philip Meade says if landlords push for rent rises, hell go to arbitration. “If they dont push for increases, well let sleeping dogs lie and accept a standstill.” And by this time next year, the overwhelming pattern will be downward, adds Mr Meade.
Others take a different line. Chris Bourchier of the Crown Estate says an across-the-board downturn in rents this spring is “just not logical”. On average, a slight increase will be seen – but nowhere near as big as the figure seen last year.
“Last years wheat harvest was universally good worldwide – there were no disasters and very few poor performers. I would find it hard to believe that this years could be as good, so this could boost world grain prices over the next three years.”
Oliver Harwood of the Country Landowners Association says: “All the banks are predicting that sterling will be falling by the end of the year which will lead, inevitably, to an improvement in farming fortunes.”
One Lancashire farmer, who asked not to be named, said he was “absolutely stunned” by a request for a 20% rent rise.
On grade 4 land in the Ribble Valley, he has seen his milk fall in value to 20.5p/litre, compared with 26p/litre two years ago. And sheep which made £48 last February are now worth £25.
The increase agreed, after months of wrangling, was less than half of the original figure. “And even that, I cant justify in business terms.”
He now urges other tenants to take professional advice, as he did. “The amount of rent we will save over the next three years by negotiating the lower figure covers the agents cost six times over.”
For this and other stories, see Farmers Weekly, 27 February-5 March, 1998