IN THE FI E L D AGRICULTURAL UPDATE | SPRING 2021
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We’ve been a part of the rural community for over 170 years. Securing grants and BPS payments, managing landlord and tenant relationships, as well as selling farms, livestock, crops & machinery.
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INTRODUCTION 2020 was a year largely of stress and confusion but also of clever adaptation and resilience shown by so many in our own industry and beyond. The agricultural industry has continued full throttle; from the first markets in lockdown under an air of the unknown, to a booming trade in all sections at Sedgemoor through the summer months, and all while grappling with Covid-19 restrictions. Our agricultural professionals, land agents and auctioneers have worked tirelessly throughout to support the industry and keep everything going. We thank our clients for their support and forbearance as we navigated an ever-changing landscape. This year we are pleased to resurrect our annual publication and ask some of our
experts to explain a few things about what GTH has been doing through this chaotic year and, more importantly, looking to the future at some of the big topics on the horizon and new opportunities. We hope that during 2021 we will be seeing you in person at the local shows we have all missed so much this past year. In the meantime, please don’t be afraid to pick up the phone for a catch-up, we would be delighted to hear from you.
WILL HANDEL Partner Head of Agriculture 07894 616167 will.handel@gth.net
INSIDE THIS ISSUE 4
Value of Agricultural Land
8
Future of Farm Subsidy
11 Agricultural Auctions 12 Property & Land Auctions 14 Planning Opportunities 16 How Can We Help You?
THE VALUE OF LAND What impact have last year’s events had on the agricultural land market?
Nationwide data for the whole of 2020 has yet to be published, but many reports suggested that land supply had reduced by approximately 50% in the first half of 2020, compared to the same period in 2019. Not surprising in a pandemic! However, I am delighted to report that Greenslade Taylor Hunt seems to have bucked the trend and the total land area sold by the firm has actually increased from 2019, with in excess of 3,000 acres having been sold in 2020. On analysis, this total comprises generally less bare land with a greater proportion of small farms and residential holdings.
be from the commercial farming sector with farmers and agricultural businesses. Location and local competition remain key factors.
Land Values
BPS is now entering a transition period, with payments being scaled back in favour of more environmentally favourable schemes. In addition to the impact that the loss of direct subsidies could have, some other plans in the new schemes may result in more farms and land coming to the market during the transition period, especially the proposed retirement incentives and the ability to capitalise remaining BPS payments.
Values seem to have remained fairly steady throughout 2020, with low percentage rises in some areas. Not surprisingly, the reduced supply of land available has constrained the market and helped to maintain prices. In the North Devon area values generally range between £5,000-£7,000 per acre for reasonable pasture land, whilst better quality arable parcels have been in the £6,000-£8,000 bracket. In areas where demand is strong figures in excess of these levels are regularly being achieved. Supply continues to be one of the main governing factors with very few farms and large blocks of land coming to the market, whilst the principle demand continues to
What next? With Brexit negotiations now seemingly behind us, quite what the fall out will be is perhaps too early to gauge. It is also too early to assess the true financial impact of the Covid pandemic but generally if residential property prices begin to falter land is often seen as a safe haven for investors.
Where is demand for agricultural land coming from? As mentioned above, adjoining and local farmers, landowners and agricultural businesses remain the strongest contenders, especially for the larger -4-
So ld
So ld ROMANSLEIGH Guide Price: £950,000 65.72 Acres
So ld
So ld
K E N T I S B U RY Guide Price: £1,200,000 62.76 Acres
WITHERIDGE Guide Price: £1,875,000 178.21 acres
ld So
So
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U P O T T E RY Guide Price: £1,550,000 93.34 acres
WIVELISCOMBE Guide Price: £1,250,000 99 acres
B U C K L A N D S T M A RY Guide Price: £1,800,000 113 acres
THE VALUE OF LAND (CONT.) blocks. Opportunities to buy adjoining or conveniently accessible land rarely materialise and for those committed to the industry long term, they are chances not to be missed. Whilst lenders are generally a little more cautious the advantage of historically low interest rates undoubtedly adds to the attraction.
considering conservation type projects and ‘re-wilding’ has become a bit of a buzzword. Longer term, it is perhaps not inconceivable to see marginal land values increase to compete with, or even exceed, the values of some of the more productive areas, as land management priorities shift.
The increase in house building and release of greater volumes of development land has meant that some areas are experiencing significant demand from purchasers with ‘rollover’ funds, which in turn can distort local markets and send prices soaring.
As we head into 2021, and when things hopefully do eventually settle down, I personally feel there is a positive outlook for a strong land market moving forward. As a firm we have an ever-increasing list of prospective purchasers looking for farms, small and large blocks of land across the south west region and this can only bode well for those contemplating a sale. Reduced supply should maintain values and there is always a scarcity of the best quality holdings and land on the market. As farmers well know, quality always sells. Whatever happens to the economy, as an island nation, land will continue to be a sought after commodity and every year there is less of it. As the old saying goes ‘they’re not making it anymore’!
Smaller parcels of land are still mainly contested by non-farming buyers. Equestrian interest remains strong, but we have undoubtedly seen an increase in lifestyle buyers looking to purchase their own small part of England. As a result of the ongoing pandemic the desire to find an ‘escape’ has increased, with private green space affording the solitude and privacy many people are currently seeking. Interestingly, and perhaps in line with the government support policy shifting towards ‘public money for public good’, we are seeing greater demand for marginal land from purchasers with environmental intentions. Some are considering forestry, with carbon off-setting and carbon trading likely to grow in popularity. Other buyers are
Looking ahead
RICHARD WEBBER Partner | 07740 881180 richard.webber@gth.net
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If you are considering marketing your property, our agricultural professionals are part of the rural community and are ideally placed to offer you expert advice. From an initial free, confidential market appraisal, a comprehensive plan will be drawn up to provide maximum coverage and visibility to buyers. Contact one of our team to discuss your options and find out how they will work to get the best possible result for you. Scan here for more information about our services.
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£ FUTURE OF FARM SUBSIDY Is the Government’s environmental vision right for your bank account?
For a scheme that is largely undeveloped, there is plenty of discussion that ELMS is going to revolutionise agriculture writes agricultural surveyor James Wotton MRICS FAAV. There seems to be a general feeling that farmers will soon be turning their backs on production and turning farms into wildlife sanctuaries. The Basic Payment Scheme will begin to be phased out in 2021 and will be gone within seven years. So what should a farming business be looking at to maximise their position? ELMS – The future? The Environmental Land Management Scheme is scheduled for a phased introduction with smaller schemes and pilots over the next year or two, but the full national release will not be until 2024. So, whilst ELMS is currently very topical, farmers probably won’t be changing their practices too much for a while yet. ELMS will be based on the premise of ‘Public Money for Public Good’, which broadly translates to being, ‘UK Government backed payments to support land management that provides wider public benefit’. Examples of these types of land management and public benefit could include: the management of water to prevent flood risk, soil management
to capture carbon or planting to enhance landscape and biodiversity. ELMS will also be based on a tiered system, similar to the schemes of the past, with a basic first tier, which will be farm-based and has been referred to as the sustainable farming incentive. The idea is a lower level payment for lower level changes, for instance sensitive hedgerow management or alternative soil cultivations. I would expect this to look similar to Entry Level Stewardship. The second tier focuses on collaboration between farmers - on local public goods which could not be achieved by one holding alone - for example with a joined up approach to water management to prevent a local flood risk or linked up planting for biodiversity corridors. The third tier agreements will work at a landscape scale; these will handle the largest and most complex situations. Peatland restoration is often cited as an example, but I envisage this being similar to the Higher Level Stewardship agreements over common land and coasts that we currently see. The here and now ELMS is the direction of travel, but is some way off. Is it worth taking another -8-
and winter bird mix at £250 per acre per annum for less productive areas.
look at the options currently open? The UK Government has assured that anyone with a live stewardship agreement will not be unfairly disadvantaged; most have interpreted this to mean these agreements can be terminated early and ELMS could be signed up.
The capital grant elements can often see alignment between farming and the environment too, for instance the ability to erect stock fencing to prevent livestock straying into a watercourse or damaging traditional hedgerows. Grants can include the roofing over of outdoor livestock feed yards to reduce dirty water pollution, the coppicing of historic hedgerows to maintain heritage or the planting of fruit trees to restore traditional orchards.
In my opinion, whether you are an intensive dairy business or environmental freedom fighter, Countryside Stewardship (CSS) is worth a look. In the past couple of years, GTH has secured several million pounds worth of agreements for clients across the South West. No doubt there will be changes to CSS over the next few years as the scheme continues to adapt, but CSS currently offers annual payments for land management, as well as capital grants towards farm improvements. There are hundreds of options available. Annual payments for red clover and herbal grassland equate to £120 per acre per annum, whilst providing plenty of pollinator activity, they can still be highly productive and offer a decent income. An example of arable options include wholecrop cereal production for £200 per acre per annum
CSS has a history of being complex and bureaucratic with delayed payments and tiresome record keeping. However, each application is bespoke and can be tailored to the applicant and the farm; professional experienced advice is usually the difference between a successful live agreement and an incomplete application form that never quite gets submitted.
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JAMES WOTTON Surveyor 07899 955935 james.wotton@gth.net
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AGRICULTURAL AUCTIONS Has Covid-19 accelerated technological advances in auctioneering? Our auctioneers acted quickly when all machinery and dairy sales were shut down by Government decree in March, ensuring that sales could proceed in a Covid-secure environment.
This format worked well through lockdown and we will still use it for certain sales but we hope 2021 will allow us to continue back on farm for machinery sales and to hold all our sales live if possible.
We altered our practises to ensure our clients could still trade, whether that be their freshly calved heifers or the dispersal of all of their machinery and effects.
However, the firm will not be abandoning technological advances. Instead the auctioneers have come up with a platform which merges the attractions of the live auction with an online app via a webcam. This means that both bidders attending the sale or those elsewhere can all compete for the lots on offer.
Auctions are centuries old and work for a reason. As was found during lockdown, selling privately you are offering your stock to one customer whose job is to drive down prices, whereas at auction you are offering to many and the price only ever increases. It was therefore extremely important to return to auction as soon as possible to offer the best results for our clients. We started with timed auctions on our bidding platform gth.auctionmarts.com, offering machinery dispersals all finishing on one evening with set viewing days on farm. The site became very addictive viewing. With the majority of the bidding in the final hour, many were glued to their computers or phones and impressive results were achieved.
The Marteye app is working smoothly and crucially, the bidding is in ‘real time’ meaning it does not cause a delay in the sale room. The app has already been used successfully on a number of dairy sales. Live auctions with online and telephone bidding have also been used for the firm’s farm, land and property sales. In essence, auctions are the tried and tested method of achieving maximum prices and that isn’t going to materially change, but technology can make it more accessible and highlight further opportunities.
The annual Spotlight Sale of Elite Dairy Cattle was successfully held in this format ANDREW CLEMENTS with buyers from across the United Kingdom Associate | 07769 904704 and Ireland. andrew.clements@gth.net - 11 -
AGRICULTURAL AUCTIONS Has Covid-19 accelerated technological advances in auctioneering? GTH has been operating property auctions throughout the South West of England for over 170 years now. Our auction venues have ranged from village halls, hotels, pubs and a variety of clubs, livestock auction centres, fields, farm buildings and country houses writes Justin Lowe MRICS, Partner at the Yeovil office. The onset of covid in early spring of last year brought us fresh challenges without the ability to sell in front of the public. Our ballroom auctions were immediately cancelled and we automatically reverted to an online auction system which has now been successfully running for the year with monthly dates set for 2021. Unlike other auctioneers around the country we have set up two separate online systems to cater for as wide an audience and location as possible. Firstly we run a livestream auction service conducted from our Yeovil office. I conduct the auction sales on behalf of Greenslade Taylor Hunt with the help of supporting staff who take bids by telephone. The system also allows people to bid online. Unconditional contracts are exchanged at the fall of the hammer with deposits and costs taken in advance of bidding. All purchasers must have registered in advance of the auction with their Anti Money Laundering Information.
Our second online (ebay style) system allows us to start auctions at shorter notice to suit the vendor requirements as long as a legal pack has been prepared. We use the Bamboo online platform with exchange of contracts occurring online immediately at the end of the specified time period subject to the reserve being met or exceeded. The successful purchaser is legally obliged to complete within the specified time period. Whatever the method of sale, all bidders on our site are pre-authorised and are required to input their payment details in advance of making a bid. Successful bidders are required to make a payment immediately at the end of the auction, so you know that buyers are committed to completing the sale. We have similarly had great success with this system selling land, farms, residential properties, building plots, solar sites and water towers all over the West Country and further afield, including a parcel of woodland in Berkshire.
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JUSTIN LOWE Partner 07767 621274 justin.lowe@gth.net
Development Opportunity, Crewkerne Guide Price: £290,000 Sale Price: £290,000
29 Silver Street, Bridgwater Guide Price: £50,000 Sale Price: £92,000
Land off Strowlands, Highbridge Guide Price: £70,000 Sale Price: £91,000
Solar Site, Long Sutton, Langport Guide Price: £250,000 Sale Price: £315,000
Broadclyst Water Tower, Exeter Guide Price: £36,950 Sale Price: £227,000
Higher Eastbrook Farm, Tiverton Guide Price: £750,000 Sale Price: £792,000
PLANNING OPPORTUNITIES Are you considering erecting an agricultural building? Whether you are looking to erect a state of the art new dairy parlour or are simply looking to extend an existing straw barn, you are very likely to require approval/ permission from your local authority before you can begin works. There are a number of different types of application which vary in cost and complexity so it is important to choose the right one in order to suit each scenario and ultimately to protect your farm business. The following guide will give an overview as to the different types of application available:
Permitted Development Rights — What are they? Some proposals are deemed to be ‘permitted development’ and there is no requirement to secure planning permission from the local authority. However, in most cases you will be required to submit a ‘prior notification’ giving sufficient information for the local authority to reach a decision as to whether prior approval is required or not. Whether or not your proposal falls under permitted development depends upon
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a number of criteria, some of which are listed here:
works. This is also one of the cheapest applications with a planning fee of £96.
• The size of the agricultural unit
Full Planning Permission
• Size of the proposed building which in any event should not exceed 1000 m2
Where the former does not apply, you should apply for full planning permission for any erection, extension or alteration of an agricultural building. The process has an eight week consultation period so will take longer to reach a decision and depending on the size of the proposed development, the planning fees could be greater.
• Proximity of the development to the hardened part of a trunk or classified road • The proposed use of the building i.e. for the accommodation of livestock or for storage purposes together with its proximity to ‘protected buildings’ • Height of the proposed building The Process To apply under permitted development rights, a prior notification must be submitted to the local authority detailing the siting, design and proposed use of the proposal. The local authority have 28 days to respond and if they fail to do so, it could be that you have ‘deemed’ consent and can proceed with the proposed
GTH have experience in a wide range of planning applications, therefore if you have any queries or would like to speak to a member of our Rural Professional Department about a planning application please get in touch.
JAMIE BATT Surveyor 07766 301468 jamie.batt@gth.net
PERMITTED DEVELOPMENT PROS
CONS
Once a prior notification has been submitted, the local authority must respond with their decision within 28 days.
Using permitted development rights to erect an agricultural building could diminish the right to apply under Class Q to change the use of an existing agricultural building to residential.
The planning fee is fixed at £96 which is noticeably lower than a full planning application depending on the size of the proposed building.
The gross development area is capped at 1000m2.
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HOW CAN WE HELP YOU? At Greenslade Taylor Hunt we acknowledge that our greatest strength is our team. We have an unrivalled network of professionals across the West Country who are not only experts in their own fields but who work closely with our firm-wide network of property and auction specialists. Find your nearest office at www.gth.net/contact A GR I CU LT U R E P R O F E S S I O NA L S E R V I CE S DE V E L O P M E NT L A ND & P L ANNI NG S U R V E Y & VA L U AT I ON S A L E S | L E T T I NGS CO M M E R CI A L A NT I Q U E S
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