Agricultural Occupancy Condition

PrincessSparkle_2

We have one of the old worded ties. It ties the property to a former farm in perpetuity and restricts the occupancy to a person last employed or employed in agriculture or forestry. Where are all these people? We have advertised it for sale or rent with an estate agent and online with farming sites on and off for many years with no effect. The tie puts everyone off and the planners find fault with everything we have done: the discount wasn't high enough; the estate agents weren't the right ones; retiring farmers are applying for planning permission to build on their own land so they must want our property (if so why haven't they got in contact?) We are at our wits end and time is not on our side. We are both ill and elderly and need to move into the town and on or near bus routes. Help!

Davesnave

PrincessSparkle, did you use a proper agricultural agent and solicitor when trying to sell your house? I would have thought either, and certainly the specialist solicitor, would be able to ensure your marketing met the criteria set down by the local authority.

The idea of ag-ties is to provide low cost rural housing to those in relatively poorly paid work, not to trap people in their homes indefinitely, so a local authority, being impartial, ought to be be sympathetic to your needs.

If there is something odd about the tie, or if it has been affected by changed circumstances, then they should be looking at it carefully with help from your solicitor. They will not, however, help you to sell in a way which negates the tie. Many people use a reduction of 30% as a rule of thumb when attempting to calculate what a tied house is worth.

There are certainly people out there who wish to purchase agriculturally-tied houses, though mortgages for them may be extra tight at the moment, since mortgages in general are in short supply. Obviously, demand varies with location, but my own ag-tied property, for example, was on the market only a few weeks. I have seen several others recently, going within a month or two, though there are also the 'old chestnuts' that have been there for years, simply because they aren't priced correctly.

This really isn't a job for Bairstow Eves or your local seller of town properties; you need a specialist on the case.

andrewbrockham

Good morning all, can you help clarify something for us?

We would like to buy a small holding, becoming as self sufficient as possible. I would like to spend all of my time working the land and believe we could grow/rear much of what we would need.

Due to the size of the proposed land, 11 acres, although we could be fairly self sufficient, we can’t see there would be much surplus to sell, so we can’t see us making much of a profit. To cover this shortfall my wife would like to continue to work and this would help pay for what we couldn’t grow ie council tax etc.

Neither of us work in forestry or agriculture and the property has an AOC. Is what we are looking to do realistic and within the rules?

Davesnave

andrewbrockham wrote: »

Is what we are looking to do realistic and within the rules?

Briefly, yes, there is no requirement for both of you to be engaged in agriculture, or even that the majority of your income comes from that source. However, one of you must spend the majority of your working time on the land, and be seen to be doing so, not just pottering around with half a dozen sheep and a few hens. That would be classed as hobby farming.

If you try to make a profit by engaging in something commercial, there would be tax advantages too. HMRC will give you about 5 years to show a profit, and if you don't, well, hey-ho, that's life, and at least you have had those tax advantages. I'm doing something like that, and by the time we know whether it works or not, I'll be an OAP......enough said!;)

With 11 acres you could actually make some serious money, on say, pigs, or vegetables, but it depends on what the land is like, and your own interests, of course. In a previous life, my wife & I made a decent business on less than an acre, growing & selling herbaceous plants.

As regards the ag tie itself, each local authority varies in the tightness with which it monitors these, so yours could be decidedly slack, like some I know, or quite vigilant. A good local solicitor used to dealing with rural matters would advise. Personally, I feel that with the swingeing cuts we shall see in LA budgets, ag ties will be pretty low down the list of their priorities in the future!

Best of luck with it, anyway. I know what it's like, attempting to secure a property with land on a strict budget.

lincroft1710

Andrew, if you haven't already done so it may be worth your while checking with the planning authority that there is definitely an AOC.

The reason I say this is that I used to deal with Council Tax appeals and received a request from a smallholder for a CT reduction on his house (about 30 years old) because of an AOC. I checked with the planning authority and they could find no trace of an AOC for the property. Smallholder thought that not getting a CT reduction was far outweighed by the perceived increase in the value of his house.

Best of luck in your search for a property and I hope you find something suitable.

homegrownpigs

we are looking to buy a property with an AOC, in talking to the planning department they have suggested that we explain to them our intentional use of the property and then they will decide whether they would grant us permission (or whatever it is they do).

My partner is a retired policeman therefore receiving a pension, I am self-employed in market research (obviously so far neither of which relate to agriculture).

We have a 15 month boy who is obviously going to be dependant for quite a while.

We have started up a smallholding in a rental property, and now wish to buy our own property and move it across. We have 7 breeding sows and 2 boars, 17 sheep and numerous ducks and chickens.

We supply a hog roast man with pigs, next year he wants to take 8 pigs a month between may and sept, therefore its quite a big undertaking. The income we would receive from the supply of food products would make us a small profit, the majority of our income would be from the pension or anything I earn (at present my income is low due to the recession).

The time my partner would spend looking after the animals, would be in excess of 25 hrs a week. He also currently does 9 hours driving for tesco (in order to pay for the pigfood). I would also be spending 10 hours or so a week doing the paperwork and helping out, as well as 30 hours doing my main job if work permits.

From other posts, it looks like we would be able to buy the house (the planning officer also seemed to think it was a possibility based on my partners details although the tesco driving was omitted from the conversation)

My questions are based on this information :
Would it be a problem for him to work at tesco for 9 hrs a week.
How long would our son remain a dependant, given our ages my partner is 58 and I am 43, obviously if our son remained in full time education til the age of 18 my partner would be 76 years old and probably not doing a lot with the smallholding. Our son (if we still kept the animals) would be then doing most of the work, so could we in effect just transfer the deeds to him at that point, or could he remain living there once we both died ?
What if we stopped running animals at the site, would he still be able to live there after we died ?
If my partner dies, I assume I am able to continue living there at which point would it be best to put the property into my sons names jointly with mine ?

Obviously we do not want to give him a headache when he is older!

Any thoughts would be gratefully appreciated.

andrewbrockham

Thanks for that. We went to the auction, guide price £275,000 for 11 acres of grade 3 and a small 2 bedroom house, that would need to be rebuilt, really more a building plot.

There is an AOC and the hammer fell at...£602,000! Out of our price range, people who work in farming must be getting paid alot more than we thought!

Davesnave wrote: »

Briefly, yes, there is no requirement for both of you to be engaged in agriculture, or even that the majority of your income comes from that source. However, one of you must spend the majority of your working time on the land, and be seen to be doing so, not just pottering around with half a dozen sheep and a few hens. That would be classed as hobby farming.

If you try to make a profit by engaging in something commercial, there would be tax advantages too. HMRC will give you about 5 years to show a profit, and if you don't, well, hey-ho, that's life, and at least you have had those tax advantages. I'm doing something like that, and by the time we know whether it works or not, I'll be an OAP......enough said!;)

With 11 acres you could actually make some serious money, on say, pigs, or vegetables, but it depends on what the land is like, and your own interests, of course. In a previous life, my wife & I made a decent business on less than an acre, growing & selling herbaceous plants.

As regards the ag tie itself, each local authority varies in the tightness with which it monitors these, so yours could be decidedly slack, like some I know, or quite vigilant. A good local solicitor used to dealing with rural matters would advise. Personally, I feel that with the swingeing cuts we shall see in LA budgets, ag ties will be pretty low down the list of their priorities in the future!

Best of luck with it, anyway. I know what it's like, attempting to secure a property with land on a strict budget.

Davesnave

andrewbrockham wrote: »

Thanks for that. We went to the auction, guide price £275,000 for 11 acres of grade 3 and a small 2 bedroom house, that would need to be rebuilt, really more a building plot.

There is an AOC and the hammer fell at...£602,000! Out of our price range, people who work in farming must be getting paid alot more than we thought!

Care to enlighten us about which county these insane bidders are living in, or indeed, what planet they're on?

Guide prices are always set unrealistically low for any landed property, but the amount achieved there suggests someone in the know has more than a hunch about redevelopment. It must be in a pretty & convenient spot. Folk who can stump up £600k before they begin alterations aren't the sort to be content with a mere farm-worker's cottage in the back of beyond.

All great support for my belief that, as these places are no longer fulfilling the role for which they were created, the whole system should be abolished, but then I would say that!

I shall now demolish my own argument by saying that it is still just possible to buy something livable with a few acres for around £300k, without going to some remote place in Wales, but it's becoming very hard.

Davesnave

Homegrownpigs, I wouldn't think the Tesco driving, as the secondary activity your husband does, would affect his entitlement to buy a property with an AOC. If he would be putting in 25 hours + per week on the smallholding then that would constitute his main employment. It would help greatly if he kept proper records & made returns to HMRC, of course.

I certainly wouldn't complicate things by giving the info about your husband's second job to the council; just focus on your intended use for the property.

As regards the long term questions, your son will stay a dependant until 18, and possibly much longer if going down uni/FE routes. You would be OK to remain at the property as a widow, or your husband would be entitled to retire & remain there when his age or his health made withdrawal from serious farming activities necessary.

As for your son inheriting the property and being able to stay on there, I think that is a scenario which is too far removed from today to comment on. Children and plans rarely turn out as we imagine and you may find, as I did, that your child will find the whole business of plant growing & animal keeping a total turn-off! I have one stay-at-home and another who couldn't wait to put a few hundred miles between us. She is changing her outlook now, eight years on, but had we needed her to help run a smallholding, we'd have been out of luck.

andrewbrockham

Davesnave wrote: »

Care to enlighten us about which county these insane bidders are living in, or indeed, what planet they're on?

Guide prices are always set unrealistically low for any landed property, but the amount achieved there suggests someone in the know has more than a hunch about redevelopment. It must be in a pretty & convenient spot. Folk who can stump up £600k before they begin alterations aren't the sort to be content with a mere farm-worker's cottage in the back of beyond.

All great support for my belief that, as these places are no longer fulfilling the role for which they were created, the whole system should be abolished, but then I would say that!

I shall now demolish my own argument by saying that it is still just possible to buy something livable with a few acres for around £300k, without going to some remote place in Wales, but it's becoming very hard.

Somerset...and the land is greenbelt, so realistically how big a new house would be allowed? Doesn't add up, maybe too much cider? Is remote Wales not such a good idea?