News
26th Jan

2016

TFA Media Release No. 06 – Interesting Results in TFA “Guess the Rent” Competition

Interesting Results in TFA “Guess the Rent” Competition

The Tenant Farmers Association used its presence at this year’s LAMMA show to hold a “guess the rent” competition for visitors to its stand and it produced some interesting results.

The TFA used a real life rent review case of a 20 acre block of grade 3 arable land in Essex with no buildings or dwellings.  The land was let on a Farm Business Tenancy and the rent had been reviewed three years previously.  Prior to the review, which took place in September 2015 the passing rent had been £130 and people were asked to guess where it had been settled in the negotiation.  The correct answer was that it had settled at £115 per acre, a decrease of £15 per acre.

TFA Chief Executive George Dunn said “The range of guesses made by people was a real surprise.  The lowest rent suggested was £60 per acre and the highest was £210 per acre.  Most people thought that the rent had increased but there were also a large number who considered that a standstill was the right answer”.

“Some of the higher guesses came from land agents, which only goes to show that in some cases they are out of touch in regards to the rent that tenants should be paying.  Many people also thought that because the rent was at the lower end of the scale for some passing rents to begin with, that it had settled at a standstill or increased,” said Mr Dunn.

“The TFA has been saying for some time that rents should be coming down.  On tenancies let under the Agricultural Holdings Act 1986 we have seen some reductions and many more standstills, but we believe that there should have been more reductions.  Farm Business Tenancy rents must fall too and our competition shows that this can, and indeed does happen,” said Mr Dunn.

“On Farm Business Tenancies, the TFA believes that there is scope for decreases where rents were properly reviewed three or four years ago.  Tender rents are coming down, but we do still hear cases where tenants are putting in too high a rent at tender and then hoping that they will be able to get the rent down at a rent review,” said Mr Dunn.

“Tenants who are under notice must take advice about the best course of action to take.  If no rent review notice has been served by the landlord then tenants must consider whether it would be appropriate for them to serve one themselves,” said Mr Dunn.

end

Ref:  MR06

Date: 26 January 2016

Notes for Editors:

For further information contact George Dunn on 07721 998961 or the TFA Communications and Events Co-ordinator Jenna Kirkpatrick on 0118 930 6130.

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