Politicians may be dithering on Brexit but the prospect of leaving the European Union is having a considerable effect on UK farming according to an Oswestry-based land agent.
Philip Meade, from Davis Meade Property consultants, told a Tenant Farmers Association meeting held at Llangollen last month that Brexit has impacted on land prices and rental values, tenancy contracts and the terms on which land is being let.
Mr Meade told those gathered there had been a marked drop in demand for land because of the uncertainty over Brexit with values in some cases dropping 10 to 20 per cent from the peak of 2014/15.
He said: “Uncertainty has caused a similar drop in demand for rented land too, with notably fewer tendering for new tenancies and the amounts being tendered falling. Agricultural Holdings Act (AHA) rents are static or not being reviewed.
“Contractual and share farming agreements too are being affected, evolving almost on a weekly basis with clauses covering the Basic Payment Scheme – and what it may become – getting ever more complex.
“Clauses regarding termination are now allowing for early termination and for termination in various scenarios including an unfavourable Brexit for farming.
“In some instances clauses for post Brexit scenarios for grants, employment and tax are also being included.”
Farm Business Tenancy rents have been easing back with landlords starting to give (albeit limited) reductions without much resistance.
The range of rents is still considerable across England and Wales but there have been very few increases in AHA rents in 2016/2017. Each case turns on its merits, but the general theme has been a standstill.
Mr Meade added: “We do, however, anticipate some upward pressure on AHA rents in 2018.
“The perception seems to be among landlords that 2018 may be the last chance to get an increase for a number of years.
“Whether that proves to be the case, does of course remain to be seen.”
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