Landlords have been jacking up rents for farm tenants by unfairly comparing them to ‘exorbitant’ payments elsewhere in the market, according to the Tenant Farmers’ Association (TFA).
The group has called on landlords not to push for rent hikes this autumn as the traditional date for farm rent reviews, September 29, approaches.
George Dunn, the TFA’s chief executive, said: “We are beginning to see an alarming number of cases where landlords are seeking to raise farm rents, particularly on tenancies let as Farm Business Tenancies (FBTs) which have open market rent formulas.
“Too often we see existing operators taking on additional land on FBTs at exorbitant levels of rent, with apparent scant regard for the economics involved, and landlords are choosing to use these rent levels as comparable for existing situations.
“Landlords need to realise these levels of rent are unsustainable, and in order to preserve good landlord-tenant relationships, which ensure tenants are able to pay rent and make a profit while farming in sympathy with the land, pursuing these increases must stop.”
Mr Dunn has also suggested tenants and landlords take the opportunity to work together to secure longer tenancies which take account of the uncertainty surrounding Brexit.
To give all parties confidence about the future, he said rent reviews should be built in after Brexit when there would be more clarity on trade, Government policy, regulation and access to labour.
“Rather than spending tens of thousands of pounds in professional fees arguing over the level of rent, it would be better if landlords and tenants sat down to agree a longer-term strategy which incorporates Brexit in rent levels”, Mr Dunn added.
This is not the first time the TFA has raised concerns about unsustainable rents. In April, the group blamed unfair hikes for a widespread breakdown in landlord-tenant relationships.