Agricultural Holding Act Tenancy

DreamweaverB

Can anyone explain in layman's terms what "The land is subject to an Agricultural Holding Act Tenancy" means?

I'm looking to buy a house out in the sticks with a bit of land and this phrase or "(AHA)" keeps cropping up. All I've found online so far is a pages of legal stuff that seem to assume you already know what AHA means. :rolleyes:

angelavdavis

It means that the property must be predominantly used for argricultural business purposes (ie farm, garden nursery, horse stables, etc).

http://www.hmrc.gov.uk/manuals/ihtmanual/IHTM24220.htm

DreamweaverB

angelavdavis wrote: »

It means that the property must be predominantly used for argricultural business purposes (ie farm, garden nursery, horse stables, etc).

http://www.hmrc.gov.uk/manuals/ihtmanual/IHTM24220.htm

Thanks for that Angela, so does 'AHA tenancy' mean that I wouldn't actually own the land? I'm just renting its use from someone, presumably the local council?

The document you linked to talks about the land being 'protected under the legislation' but I can't work out what or who it's being protected from.

The bottom line I guess is if I buy a property with land subject to AHA and then don't use the land for agriculture then what's the comeback? Specifically I wouldn't use the land for a different purpose (unless eyecandy is considered a use) I just wouldn't use it but would want it to ensure no-one else could ever develop or use it to spoil my views etc.

PasturesNew

My first assumptions would be as follows:

If the land is subject to a tenancy, it might mean somebody is already in the property, living in it, running their business from it. That you can't turf them out because they hold a tenancy on it.

These tenancies are for people who are working in agriculture and they have to be growing/rearing animals at the property.

So, it might be that you're buying a property that you can't live in.

PasturesNew

Just tried to track it down, is it this one:
http://www.savills.co.uk/residentialsearch/propertydetail.aspx?pID=246585

It reads to me like 60 acres are rented out to a farmer who is farming it. He might even be renting the gardener's cottage to live in.

DreamweaverB

PasturesNew wrote: »

Just tried to track it down, is it this one:
http://www.savills.co.uk/residentialsearch/propertydetail.aspx?pID=246585

It reads to me like 60 acres are rented out to a farmer who is farming it. He might even be renting the gardener's cottage to live in.

Unbelievable, yes, I've been looking at a few that mentioned AHA but that's the specific one that prompted the question, how on earth did you track that down from the hundreds of AHA properties out there?!?! You should be a detective if you're not already. :beer:

I did wonder about the gardener's cottage but as it was described as "Discreetly hidden" I wasn't too worried about the AST. You could be right about a farmer living there and renting the land, which I hadn't considered, time to make some enquiries.

dgl1001

You need to speak to Savills about the terms of the Farm Business Tenancy (AHA) (think of it a a lease for farming the land), as you need to understand if you can break the tenancy, its duration, compensation payable etc. The sale includes a number of assets and you need a breakdown of how each has been valued. It may be that you can purchase the estate and then sell on the other assets, land, cottage etc, at a later date, thereby reducing your purchase costs.

angelavdavis

DreamweaverB wrote: »

Thanks for that Angela, so does 'AHA tenancy' mean that I wouldn't actually own the land? I'm just renting its use from someone, presumably the local council?

The document you linked to talks about the land being 'protected under the legislation' but I can't work out what or who it's being protected from.

The bottom line I guess is if I buy a property with land subject to AHA and then don't use the land for agriculture then what's the comeback? Specifically I wouldn't use the land for a different purpose (unless eyecandy is considered a use) I just wouldn't use it but would want it to ensure no-one else could ever develop or use it to spoil my views etc.

I haven't looked at the property details, but it's as PasturesNew has stated, you own the land, but in order to purchase, you must use the land for agricultural purposes. In addition, something I had missed actually (it was a bit late for me!) that there are almost certainly farmer's cottages who have perhaps life tenancies occupying some of the properties.

As dgl1001 says, it sounds like you certainly have to find out more about the property.

DreamweaverB

dgl1001 wrote: »

You need to speak to Savills about the terms of the Farm Business Tenancy (AHA) (think of it a a lease for farming the land), as you need to understand if you can break the tenancy, its duration, compensation payable etc.

Thanks everyone, it is starting to make sense now. So the AHA Tenancy relates to I'd be the landlord and there's already a tenant leasing the land, possibly the same one renting the cottage.

I'll contact Savills and find out exactly what this would entail.

Geenie

angelavdavis wrote: »

I haven't looked at the property details, but it's as PasturesNew has stated, you own the land, but in order to purchase, you must use the land for agricultural purposes. In addition, something I had missed actually (it was a bit late for me!) that there are almost certainly farmer's cottages who have perhaps life tenancies occupying some of the properties.

As dgl1001 says, it sounds like you certainly have to find out more about the property.

Spot on. You would need to find out about the tenancy, as they could have rights that go on for decades if taken out years ago. There are also some that allow succession by other family members once the present farmer dies or retires I believe.

Agricultural tenancies are quite complex compared to a normal tenany and can come under the Agricultural Holdings Act 1986 if taken out years ago, or the more recent Agricultural Tenancies Act 1995, so you need very good advice before taking this on, especially if you have designs to live there yourself at some stage.

DreamweaverB

Geenie wrote: »

Spot on. You would need to find out about the tenancy, as they could have rights that go on for decades if taken out years ago. There are also some that allow succession by other family members once the present farmer dies or retires I believe.

Agricultural tenancies are quite complex compared to a normal tenany and can come under the Agricultural Holdings Act 1986 if taken out years ago, or the more recent Agricultural Tenancies Act 1995, so you need very good advice before taking this on, especially if you have designs to live there yourself at some stage.

It's the property that PasturesNew gave a link to (I still can't work out how they knew it was that particular one!) so has three distinct parts:

the main house - Freehold
gardner's cottage - AST
the land - AHA

So from what I can gather there'd be no problem with my living in the main house and I'd have no problem with the cottage's AST but I did have visions that the land would be mine to do with as I wish but sadly that doesn't seem to be the case.

No doubt the agents will enlighten me further once I make contact.