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So, if it’s bug*ered, why aren’t farms for sale?

Bertram

Member
Following on from Pete’s interesting thread, if the whole job is just buggered, and it appears that there’s a consensus amongst a lot of us that it is - why aren’t there more farms on the market? Surely anyone struggling with sub 500 acres must be tempted to cash in for 5 million quids now and not risk a post brexit slump in prices? Even if it only drops 20% because sheep won’t pay, roundup will be banned, beef will be a distant memory, and there will be a Vegan in number 10, that’s a million pounds. £1,000,000. Imagine how that would look in a current account. It’s worth a whole schoffel gilet. Nearly. And if it drops 50% you could have afforded a new defender too.

Or are we all waiting for the neighbours to chuck in the towel first?
 

B'o'B

Member
Arable Farmer
Location
Rutland
Following on from Pete’s interesting thread, if the whole job is just buggered, and it appears that there’s a consensus amongst a lot of us that it is - why aren’t there more farms on the market? Surely anyone struggling with sub 500 acres must be tempted to cash in for 5 million quids now and not risk a post brexit slump in prices? Even if it only drops 20% because sheep won’t pay, roundup will be banned, beef will be a distant memory, and there will be a Vegan in number 10, that’s a million pounds. £1,000,000. Imagine how that would look in a current account. It’s worth a whole schoffel gilet. Nearly. And if it drops 50% you could have afforded a new defender too.

Or are we all waiting for the neighbours to chuck in the towel first?
Inheritance Tax? Cash would drop 40% on inheritance.
 

Clive

Staff Member
Moderator
Location
Lichfield
Following on from Pete’s interesting thread, if the whole job is just buggered, and it appears that there’s a consensus amongst a lot of us that it is - why aren’t there more farms on the market? Surely anyone struggling with sub 500 acres must be tempted to cash in for 5 million quids now and not risk a post brexit slump in prices? Even if it only drops 20% because sheep won’t pay, roundup will be banned, beef will be a distant memory, and there will be a Vegan in number 10, that’s a million pounds. £1,000,000. Imagine how that would look in a current account. It’s worth a whole schoffel gilet. Nearly. And if it drops 50% you could have afforded a new defender too.

Or are we all waiting for the neighbours to chuck in the towel first?

Because farming and land ownership are not the same thing

The trade of farming might be marginal and some might be loosing money

But land ownership (investment) is as lucrative as always, rents high, subs still existent, tax breaks good, development potential ever increasing etc
 

Bertram

Member
Yes, but cash tied up in something that barely makes a return, and in fact causes stress and heartache...which looks like it’s only going to get worse as prices fall... what’s the point in hanging on to it? Put £3 mill into rental property or other investments and you’d barely have to lift a finger again.
 

Clive

Staff Member
Moderator
Location
Lichfield
Yes, but cash tied up in something that barely makes a return, and in fact causes stress and heartache...which looks like it’s only going to get worse as prices fall... what’s the point in hanging on to it? Put £3 mill into rental property or other investments and you’d barely have to lift a finger again.

But owning land isn’t “getting worse”

Owning land isn’t farming and that’s why there is no connection between farming margins and land values
 

Bertram

Member
Because farming and land ownership are not the same thing

The trade of farming might be marginal and some might be loosing money

But land ownership (investment) is as lucrative as always, rents high, subs still existent, tax breaks good, development potential ever increasing etc

Not for a 3-400 acre family farm that might not have any realistic development potential, surely? And there are lots of those, struggling on.
 

Clive

Staff Member
Moderator
Location
Lichfield
Not for a 3-400 acre family farm that might not have any realistic development potential, surely? And there are lots of those, struggling on.

Yes may be struggling farming but their investment in land should still be viable

If you own your land and can’t make a profit you need a career change !

Plenty of farmers have to make a profit after paying a 3 figure rent / acre !
 

capfits

Member
Said for years many owner occupiers are unconsciously earning more the turf than the production. Not just in farming plenty of home owners in London SE are achieving same trick. Hard working?
Hence why I believe a wealth tax is a good thing.
 
Yes, but cash tied up in something that barely makes a return, and in fact causes stress and heartache...which looks like it’s only going to get worse as prices fall... what’s the point in hanging on to it? Put £3 mill into rental property or other investments and you’d barely have to lift a finger again.

I agree with your logic, but that ain't farming.

As perverse as it sounds there are people farming out there who are so arthritic and aged they can barely walk but they simply can't leave the job alone- they are addicted to it almost and can't comprehend doing anything else with their lives. It is an industry that will consume with gusto the lives of virtually anyone who dares to so much as peer over the rim. Entire generations of people have and will continue to dedicate their entire working lives to this pursuit despite the fact their enterprise might not have made an actual shilling profit for years, and that is if they actually bother to read their own business accounts.

We have had posts on numerous threads that make even the sharpest, keenest operator wonder what the heck has happened to someone's calculator to arrive at the figures often quoted. None of it makes sense.

I've known farmers or their offspring who are so do-lally about the job that they will consider any raft of business measures to remain in the game at virtually any cost. I have met people who will keep any number of cows or stock to keep them in machinery they love so much. They might work near twice the hours of an average working week driving tractors for themselves but will never even consider getting paid cold hard cash to do the same for a man 2 miles down the road.

I still have no answer when it comes to the question of why don't more farmers cooperate with each other? They could literally be neighbours but would never countenance any kind of beneficial sharing arrangement when it came to staff, machinery or land. I've lost count of the times I have suggested that a farm might consider allowing a neighbour to grow an arable crop in a field so it was cleaned up for the host farm and made ready for reseeding and I never yet had a taker. You would think that being paid to have your own field ploughed, fertilised and sprayed with herbicide and made ready for an autumn reseed would be a good idea but apparently not.

It is a funny old game that as an outsider I apparently will never understand.
 

NLF

Member
Not sure I'd call land ownership lucrative unless you've I've got development potential. 2% cash on cash return, stagnant land prices for the past decade while the stock market doubles. As an investor I'd say in the medium term land is dead money. Hard to see it increasing in value when the SFP goes away.

As for IHT. You can give the money away and provided you live 7 years there's no tax (suggests that some people don't trust their children!)

So why do people keep at it? For many farmers it's the only thing they know. For me it's a strong attachment to the family farm that's been accumulated over generations. If I didn't own a farm already I'd buy one with my hard earned and fully taxed money. Nothing beats owning a patch of dirt and watching the flea beatle eat your crops.
 

Clive

Staff Member
Moderator
Location
Lichfield
Sell your land

Pay capital gain tax loose a big chunk of your capital

Now you have a load of cash - what you going to invest in ?

Something your kids won’t pay tax on when you die ? Something safe as you have no other income ? Something that has capital growth that keeps up with inflation. ?

......... oh yes, maybe buy some land with your cash !
 

NLF

Member
I agree with your logic, but that ain't farming.

As perverse as it sounds there are people farming out there who are so arthritic and aged they can barely walk but they simply can't leave the job alone- they are addicted to it almost and can't comprehend doing anything else with their lives. It is an industry that will consume with gusto the lives of virtually anyone who dares to so much as peer over the rim. Entire generations of people have and will continue to dedicate their entire working lives to this pursuit despite the fact their enterprise might not have made an actual shilling profit for years, and that is if they actually bother to read their own business accounts.

We have had posts on numerous threads that make even the sharpest, keenest operator wonder what the heck has happened to someone's calculator to arrive at the figures often quoted. None of it makes sense.

I've known farmers or their offspring who are so do-lally about the job that they will consider any raft of business measures to remain in the game at virtually any cost. I have met people who will keep any number of cows or stock to keep them in machinery they love so much. They might work near twice the hours of an average working week driving tractors for themselves but will never even consider getting paid cold hard cash to do the same for a man 2 miles down the road.

I still have no answer when it comes to the question of why don't more farmers cooperate with each other? They could literally be neighbours but would never countenance any kind of beneficial sharing arrangement when it came to staff, machinery or land. I've lost count of the times I have suggested that a farm might consider allowing a neighbour to grow an arable crop in a field so it was cleaned up for the host farm and made ready for reseeding and I never yet had a taker. You would think that being paid to have your own field ploughed, fertilised and sprayed with herbicide and made ready for an autumn reseed would be a good idea but apparently not.

It is a funny old game that as an outsider I apparently will never understand.
Summed it up far better than I could have.
 

NLF

Member
Sell your land

Pay capital gain tax loose a big chunk of your capital

Now you have a load of cash - what you going to invest in ?

Something your kids won’t pay tax on when you die ? Something safe as you have no other income ? Something that has capital growth that keeps up with inflation. ?

......... oh yes, maybe buy some land with your cash !

The arguments that we all use to (self) justify owning land (or buying more land!)
 

Bertram

Member
Yes may be struggling farming but their investment in land should still be viable

If you own your land and can’t make a profit you need a career change !

Plenty of farmers have to make a profit after paying a 3 figure rent / acre !

Clive, I admire your positive attitude, I really do. You look at farming as a business, not a right or a lifestyle I think, as do I. Most of the time, anyway.

But picture this.

You have a 300 acre farm. Inherited. Built up by your father. Mixture of grade 2, mostly 3, and some rougher bits.

Sibling(s) to pay off who are aware that the farm is worth a few million, on paper.

Without subsidies, what’s the income from wheat, barley and a few sheep going to be, realistically? In a good year it’s ok, you’ll turn over 100k. But in a not so good year, it’s half that. And you haven’t paid yourself a wage yet.

Yes, you can make money from owned land. But often, not very much. Maybe not enough to rent some more, and buy more kit, and have more debt, and rent some more to farm to service the debt. It’s not always an option. But you could sell it, buy those rental houses, get yourself a fairly stress free job that paid you 30k, even when you’re on holiday, and not really have very much to worry about at all.

I’m just curious as to why more farm owning farmers haven’t chosen to do this.
 

How is your SFI 24 application progressing?

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Webinar: Expanded Sustainable Farming Incentive offer 2024 -26th Sept

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On Thursday 26th September, we’re holding a webinar for farmers to go through the guidance, actions and detail for the expanded Sustainable Farming Incentive (SFI) offer. This was planned for end of May, but had to be delayed due to the general election. We apologise about that.

Farming and Countryside Programme Director, Janet Hughes will be joined by policy leads working on SFI, and colleagues from the Rural Payment Agency and Catchment Sensitive Farming.

This webinar will be...
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