AHA tenant on land for sale

[Home Farm.]

Hi, I'm new to the forum but thought this would be a good place to ask this question.
Our landlord wishes to sell the farm we have a AHA tenancy on. I'm the second generation tenant and may have a third to follow me in 25 years or so. We don't live on the farm so it's just the land and building with conversion opportunitys. We would not be able to afford to buy the lot and at 300ac it would not be very viable as a smaller unit. Has anyone been a sitting tenant on a farm that has sold and what can I expect if I sit tight. I have spoken to TFA but I wondered if there is anyone with experience of this process on here?
Thanks.

 

[Phil P]

Hi, I'm new to the forum but thought this would be a good place to ask this question.
Our landlord wishes to sell the farm we have a AHA tenancy on. I'm the second generation tenant and may have a third to follow me in 25 years or so. We don't live on the farm so it's just the land and building with conversion opportunitys. We would not be able to afford to buy the lot and at 300ac it would not be very viable as a smaller unit. Has anyone been a sitting tenant on a farm that has sold and what can I expect if I sit tight. I have spoken to TFA but I wondered if there is anyone with experience of this process on here?
Thanks.

Have you got a written tenancy? If you have sit tight and nothing should really change, if not get an agent on it ASAP!
However If you can afford it I’d be tempted to try and buy at least some of the land. Agricultural land with a sitting tenant will be much cheaper to buy than freehold land!
We have an aha tenancy on a block of land that recently changed hands. Our old land lord died and his children didn’t give us the option to buy as they where trying to pull the wool over the eyes of the buyer and sell it at freehold prices! It came back and bit them in ass in the end though and it sold at a 1/3 of there asking price! I would have bought it at that! Hopefully I may still get the chance in a few years though.
My tenancy is in a ltd company name so I’m not going to be vacating it any time soon.

 

[chipchap]

Buy as much of it as you can. Get a good price by relinquishing the tenancy on the remainder so the landlord can sell it vacant.
If you don’t buy it you leave yourself open to all the dirty tricks in the book: Whover buys it will try their damnedest to get vacant possession.

 

[Suffolk Serf]

There was a member on this forum (B&BPigman) who turned exactly the same threat into an opportunity and did a deal with his landlord so that the farm could be sold with vacant possession.
It’s none of our business how much he got but one can assume that he won’t have much in the way of financial worries anymore.
He then went and got a “proper” job.

 

[betweenthelines]

Buy the whole lot, then sell the buildings on.

25% discount as a sitting tenant + even if the Landlord puts a 25% uplift on the buildings, you'll be quids in.

 

[holwellcourtfarm]

Buy the whole lot, then sell the buildings on.

25% discount as a sitting tenant + even if the Landlord puts a 25% uplift on the buildings, you'll be quids in.

25%

We bought at 50% discount and I've heard that from others too for full AHA.

Even bigger discount for an uplift applied.

 

[Nearly]

25%

We bought at 50% discount and I've heard that from others too for full AHA.

Pick half the farm that you like most, with the buildings, roadside bits etc and tell the landlord you'll have that to vacate the other half.

At the first meeting with the landlord's agent take the next generation along even if they are only in a pushchair!

 

[Poncherello1976]

My advice, would be to buy the land. You will get it at a cheaper rate than if it was vacant. You could always sell a bit off to fund the purchase. Remember interest rates are low at the mo and I can not see them going particularly high any time soon.

 

[chickens and wheat]

Buying to sell has all kinds of tax problems. Sometimes better to let the landlord sell it. It can work if you have a buyer lined up waiting to take it off you the moment you buy
We bought buildings houses and nearly half the land, relinguishing the rest for a decent discount.

The level of discount a sitting tenant gets is a very hard thing to compare.

My agent said in his dealings this varies from 20% to 80% depending on who did the original valuation.
So who cares what the discount is !
Just strike a deal that both parties can agree on.

Watch for clauses allowing the ex owner to claw back any future development income . There will be such a clause but try keep it to 5 years or so. Not a 20 or 30 year agreement.

We are now 4 years into ownership, the mortgage was initially scary, but ownership of the land opens up business growing oportunities.
Ive borrowed nearly a such money again for new projects.

Watching someone else farm my ex fields isnt as painfull as i expected, especially when its raining non stop.
Its a reminder that land drainage done in the 70,s doesnt last for ever.

 

[Cvx1170]

I would buy at any price, its better than having some embittered priick as a landlord

 

[Nearly]

I was talking to a tenant last week that had the farmhouse, farmyard and 7 acres signed over to them in return for giving up 80 acres for road project. Everyone happy, no tax bill.

 

[chickens and wheat]

You will need some kind of expansion / diversification , buying farmland to pay for itself doesn't add up, without some extra income

 

[DRC]

I was talking to a tenant last week that had the farmhouse, farmyard and 7 acres signed over to them in return for giving up 80 acres for road project. Everyone happy, no tax bill.

I’d have thought they could’ve taken the land for a road project anyway, without much compo, as I know they can if it’s for building.

 

[Nearly]

I’d have thought they could’ve taken the land for a road project anyway, without much compo, as I know they can if it’s for building.

road project plus a bit within the town side of the road that would be developed before long. Cheaper than highways agency etc building tenant a tunnel.

 

[chickens and wheat]

Yes and no

Development Land: Tenancies, Termination and Tactics

It is important for landowners to consider the impact any existing agricultural tenancies when assessing the development potential.

www.charlesrussellspeechlys.com

 

[Lincsman]

Buy it all at a good discount, you will be able to borrow some as its value put to the lender will be full vacant price, then see how it goes, sell some buildings if need be.

 

[Formatted]

Can't you buy as much as you can afford and then sell the rest with vacant possession to a neighbour? Your grandchildren will thank you even if its hard work now

 

[Home Farm.]

Ok by the looks of this most people are saying buy what you can. What sort of discount do people think a sitting tenant should see? This is where landlords and tenants ideas will differ a lot.

 

[chickens and wheat]

Expect to pay 65-70% of true value if you have a good aha remaining.

Its not simple to compare such things case to case

 

[Poncherello1976]

We paid 2/3 the freehold value when we bought some land off our landlord. Both sides came up with same price and so a deal was easily done.
Depending on your and your landlords circumstances anywhere between 50 -75%.