What does Brexit mean for land and rural homeowners?

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Gideon Sumption of Stacks Property Search says, “Who wants gold when you can buy land? Land is a secure asset, and it outperforms gold in terms of capital growth. Yields tend to be low, but thanks to the Single Farm Payment (SFP), landowners who own more than five hectares have been receiving £75 per acre per annum.”

“But post-Brexit, will it remain politically correct for wealthy land owners to receive this subsidy? The expectation is that, post-Brexit, there will be some kind of means test or cap on the subsidies that landowners receive. It will be difficult for the Government to continue to pour money into the countryside when the NHS is on its knees.

“Smaller farmers, who rely on the SFP to make their businesses viable, will have to think harder, work harder, and probably diversify to keep their heads above water. Expect to see more solar farming and poly tunnels – crops that produce a better return than cows and sheep.

“The likelihood is that if subsidies fall, so will land prices, so the upwards trajectory we’ve been witnessing may not continue unchecked.

“All these issues will affect rural homeowners and buyers. The countryside may start to look more commercial, less appealing to rural dwellers. A buffer of land around a rural property will be more attractive as homeowners protect themselves from less appealing diversifications. So while farming land may come down in price, small parcels of land attached to a property may become more valuable.

“There’s an unknown and radical change afoot; if your home has adjacent farming land, the next few years may be a good time to be negotiating with your local farmer who is potentially more inclined to sell given the uncertainty.

“If you’re acquiring farming land adjacent to your property, remember that it remains agricultural land. If you want to use it to extend your formal garden, or if you want to build a swimming pool or tennis court, you will have to obtain permission.

“You will also have to establish whether the land is suitable for whatever use you have in mind. How is it situated in relation to the property? Is it flat? Well drained? Is there water supply? Is it fenced? Are there any footpaths running through it?

“And you’ll need to consider maintenance costs of maintaining land. Pasture will either need to be grazed by your own animals, or someone else’s, and will need fencing and insuring. Woodland needs regular care and attention.

“Owning land comes at a price, both in monetary terms and time, so it’s wise to establish what the price is likely to be before taking it on.”


 

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Stacks Property Search & Acquisition, 01594 842880 / www.stacks.co.uk


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