Why do farmers not like leasing out land?

Stan27

With the price of rented land, and so many farmers under stocked, why don't farmers rent out their land tax free.

Makes total sense. More money to be made.

Wildsurfer

What makes sense doesnt come into farming a lot of the time. I know a guy in his eighties running a few sheep and cattle on his land and its nearly gone into wilderness. Another guy killed from trying to work full time and keep sucklers as well. Both have dairy farmers all round them who would pay well for land but no way would they rent. Rather see the place go wild than let someone maybe make money out of it.

Username John

Stan27 wrote: »

With the price of rented land, and so many farmers under stocked, why don't farmers rent out their land tax free.

Makes total sense. More money to be made.

I have some of ours let out, so some people do it...

But - it's a bit like saying why don't people who don't use all the rooms in their house, not let out rooms to people?

The real answer is cos it's theirs, and if they don't want to, they don't have to...

J.O. Farmer

Wildsurfer wrote: »

What makes sense doesnt come into farming a lot of the time. I know a guy in his eighties running a few sheep and cattle on his land and its nearly gone into wilderness. Another guy killed from trying to work full time and keep sucklers as well. Both have dairy farmers all round them who would pay well for land but no way would they rent. Rather see the place go wild than let someone maybe make money out of it.

It's a bit unfair to say they'd rather see it go wild than see someone else make money out of it.

The man in his eighties was probably keeping cattle and sheep before some of those dairy farmers were born. He shouldn't just give up because the lad next door is dairying and would pay more in rent than he's making at sheep.

The same with the sucklers man, he's entitled to farm whatever way he wants even if he'd make more leasing out.

There's something that a lot of people who are looking at land being "under productive" forget. Maybe the farmers enjoy what they do and going out looking at their few sheep and mentally it's good for them.
They might not get the same enjoyment looking at the neighbours dairy cows on the land and a bigger bank balance.

f140

Its probably whats keeping the 80 year old man alive. He would probably go GAGA if he didnt have the few cattle to come out to every morning and could be 6ft feet under himself if he didnt have it to keep him occupied. Health is better than wealth and all that.

X6.430macman

Lads would abuse ground..use it for a couple years and have it burnt out

Sam Kade

Stan27 wrote: »

With the price of rented land, and so many farmers under stocked, why don't farmers rent out their land tax free.

Makes total sense. More money to be made.

You answered your own question, because they are farming it.

.........

It's a risk, if you get a dodgy tenant, who wouldn't look after it.

What makes less sense to me is why more farmers don't some rent extra land to make their overall operation more viable, it's very cheap in comparison to buying, and you'd never have it paid off in a lifetime if you bought it, and you still have your core farm.

Username John

X6.430macman wrote: »

Lads would abuse ground..use it for a couple years and have it burnt out

Not all lads are like that...

Who2

......... wrote: »

It's a risk, if you get a dodgy tenant, who wouldn't look after it.

What makes less sense to me is why more farmers don't some rent extra land to make their overall operation more viable, it's very cheap in comparison to buying, and you'd never have it paid off in a lifetime if you bought it, and you still have your core farm.

renting more land isnt going to turn an un-viable farm into a viable one. The cost of stocking it alone is a major cost, then sheds and the couple of years transition with next to none or even costing money just to be able to say ive a bigger mickey than the next door neighbour. most farmers aren't fools, they know what they can make, and know how much they want to do.

.........

Who2 wrote: »

renting more land isnt going to turn an un-viable farm into a viable one. The cost of stocking it alone is a major cost, then sheds and the couple of years transition with next to none or even costing money just to be able to say ive a bigger mickey than the next door neighbour. most farmers aren't fools, they know what they can make, and know how much they want to do.

That's far too general, it entirely depends on what you're doing and how you're doing it. I know quite a few lads that are doing very well by renting extra land, land they otherwise would never have access to or paid off in two lifetimes.

Mac Taylor

Why should they like leasing it out. The lads that lease land around here I would not like inside the gate.
When the day comes that I have to slow down and assuming no one is interested at home, I will buy a few drystock and get someone to cut hay or silage on everything else. If I'm pushing daisies one way or the other it will not bother me:D

adam14

......... wrote:

That's far too general, it entirely depends on what you're doing and how you're doing it. I know quite a few lads that are doing very well by renting extra land, land they otherwise would never have access to or paid off in too lifetimes.

You would need to be renting a lot of land to make much of a return from it. It's hard to make a return on your own land!

jimmycrackcorm

Stan27 wrote:

With the price of rented land, and so many farmers under stocked, why don't farmers rent out their land tax free.

You should watch that movie 'the field'.

Cattlepen

Wildsurfer wrote: »

What makes sense doesnt come into farming a lot of the time. I know a guy in his eighties running a few sheep and cattle on his land and its nearly gone into wilderness. Another guy killed from trying to work full time and keep sucklers as well. Both have dairy farmers all round them who would pay well for land but no way would they rent. Rather see the place go wild than let someone maybe make money out of it.

The man in his 80's might not be farming his land to its full potential but it's HIS land. He can do whatever he wants with it

.........

adam14 wrote: »

You would need to be renting a lot of land to make much of a return from it. It's hard to make a return on your own land!

not if you go through the books, get rid of sentimentality, and anyting that isn't generating decent profits anymore, regardless of how long it's been done on your farm, and concentrate on what is making money.

Who2

......... wrote: »

not if you go through the books, get rid of sentimentality, and anyting that isn't generating decent profits anymore, regardless of how long it's been done on your farm, and concentrate on what is making money.

if you were to concentrate on whats making money you wouldn't be farming, simple. there's far easier ways out there to make a crust if its just for the money.

.........

Who2 wrote: »

if you were to concentrate on whats making money you wouldn't be farming, simple. there's far easier ways out there to make a crust if its just for the money.

nah, farming is a business and a great lifestyle combined, if you can't make money, you shouldn't be at it, same as any other business, there's no room for sentimental old practices for the sake of them.

Wildsurfer

Cattlepen wrote: »

The man in his 80's might not be farming his land to its full potential but it's HIS land. He can do whatever he wants with it[/QUO
I knew this would be an emotive thread, questioning a farmers use of land! Look I'm not saying he can't do what he wants with his land, but when you see some farmers trying to turn mountain and bog into productive land it is hard to watch sound land going into disrepair. This older man has a farmer on his bounds milking 50 cows and a young family. Wouldn't it be nice to see him get an opportunity to rent even some of this land to try and expand his enterprise? But it's this mentality of trying to bring the land to the grave with you is what needs to change. All we all are is caretakers of the land at the end of the day.

Stan27

Sam Kade wrote: »

You answered your own question, because they are farming it.

They are barely farming it.
Say I had 150 acres, very understocked and was elderly.

It is better to keep farming the 50 acres and lease out the other 100. If s it's a long term lease the man taking it wouldn't abuse the land.
Also less work load and more money for the elderly farmer.

patsy_mccabe

You can rent out a room in your house tax-free Stan. Why don't you do it? Similar situation.

Username John

Stan27 wrote: »

They are barely farming it.
Say I had 150 acres, very understocked and was elderly.

It is better to keep farming the 50 acres and lease out the other 100. If s it's a long term lease the man taking it wouldn't abuse the land.
Also less work load and more money for the elderly farmer.

Sure so what if they're not...

Say you had 150 acres, and was young...

You could sell the 150 acres... sell the whole fecking lot...

You would win in two ways...
1) You'd have a wad of cash in your pocket
2) You wouldnt have to worry about what lads would be saying you should do with the farm when you get on a bit, as twould be gone...

Problem sorted!

Stan27

patsy_mccabe wrote: »

You can rent out a room in your house tax-free Stan. Why don't you do it? Similar situation.

I don't have a house. (Under 30)

But I do rent out a room off a lady ironically. She says it's an excellent idea.

Sam Kade

Stan27 wrote: »

They are barely farming it.
Say I had 150 acres, very understocked and was elderly.

It is better to keep farming the 50 acres and lease out the other 100. If s it's a long term lease the man taking it wouldn't abuse the land.
Also less work load and more money for the elderly farmer.

They also balance things out, if all land were intensively farmed we would be over producing even more and the price of farm produce would drop. Remember what happened last year when milk production increased?

Stan27

Username John wrote: »

Sure so what if they're not...

Say you had 150 acres, and was young...

You could sell the 150 acres... sell the whole fecking lot...

You would win in two ways...
1) You'd have a wad of cash in your pocket
2) You wouldnt have to worry about what lads would be saying you should do with the farm when you get on a bit, as twould be gone...

Problem sorted!

I am young. If I got the farm I would lease it out. As a young man it would be a great help for paying a mortgage if I ever got one.

I would never sell, if I had the option I would like to do a little farming when I am older as a hobby.

Land is there to make money. End of.

Stan27

Sam Kade wrote: »

They also balance things out, if all land were intensively farmed we would be over producing even more and the price of farm produce would drop. Remember what happened last year when milk production increased?

We need more food, if the politics can be sorted , Ireland should be one of the best food producing countries in Europe.

pedigree 6

patsy_mccabe wrote: »

You can rent out a room in your house tax-free Stan. Why don't you do it? Similar situation.

Not really Patsy.:pac:

It's a bit different having someone lodging and fighting over the remote and having someone going with a combine harvester 200m from the house.

I am renting land from a neighbouring farmer for the last 15 years i'd say and the land is treated the very same as my own. Limed, reseeded, fenced etc.

Money is always paid on time and it's win win for both parties.

It's kind of a silly thread. Plenty land owners renting out land and no shortage of takers.

Username John

Stan27 wrote: »

I am young. If I got the farm I would lease it out. As a young man it would be a great help for paying a mortgage if I ever got one.

I would never sell, if I had the option I would like to do a little farming when I am older as a hobby.

Land is there to make money. End of.

If you got a farm, then twould be totally up to you to lease it out or not. Until then, its none of your business really

Tell us all what you are doing with your life, and we'll all weigh in and tell you what you should be doing...

Panch18

Stan27 wrote: »

We need more food, if the politics can be sorted , Ireland should be one of the best food producing countries in Europe.

ahhh no we don't need more food

A bit of a fallacy that gets spouted around a lot

and even if we did there is more than enough land in the world to produce it which is currently not being utilised

jooksavage

f140 wrote: »

Its probably whats keeping the 80 year old man alive. He would probably go GAGA if he didnt have the few cattle to come out to every morning and could be 6ft feet under himself if he didnt have it to keep him occupied. Health is better than wealth and all that.

My dad is 82. Although the farm was transferred over to me a few years ago, he's the one farming it while I do a few hours after work and at weekends. He does two marts a week and sends off 150 bullocks for slaughter every year. He took a knock last year when a bullock ran against him and was confined to the house for a month - you could actually see him deteriorate. But he right as rain again when he got back to the slogging away at cattle and silage and sh**e.

Stan27

Username John wrote: »

If you got a farm, then twould be totally up to you to lease it out or not. Until then, its none of your business really

Tell us all what you are doing with your life, and we'll all weigh in and tell you what you should be doing...

lol I'm not saying people have to rent it out, just wanted to know people's reasons why many don't do it. M

Farm advisory, I won't name the company though.(not hard to guess though)
Just I see it with many farmers who are struggling financially, and I'm just looking for ways to help.
Many farms who are understocked and the farmer is working also, yet a dairy farm is close and would pay decent money for land.

Many cases the farm wouldn't have to change his stock numbers that much, and would have an improved cash flow.

Sam Kade

Stan27 wrote: »

We need more food, if the politics can be sorted , Ireland should be one of the best food producing countries in Europe.

The world is currently producing enough food yearly to feed 10 billion people with a population of 7 billion and a percentage of them starving. These stories about running out of food and famine because of the fiction of expanding population are nothing other than scare stories to take people on a guilt trip.

Stan27

Sam Kade wrote: »

The world is currently producing enough food yearly to feed 10 billion people with a population of 7 billion and a percentage of them starving. These stories about running out of food and famine because of the fiction of expanding population are nothing other than scare stories to take people on a guilt trip.

That's interesting!


I think it's a problem now that food quantity is more important than food quality.
Would you agree or disagree ?
Thanks.

Timmaay

Stan27 wrote: »

That's interesting!


I think it's a problem now that food quantity is more important than food quality.
Would you agree or disagree ?
Thanks.

The problem is profits are a lot more important than food in almost every link of the chain. We produce food for 10 billion worth of people because its cheaper to overproduce food, and then accept losses/waste/inefficiency throughout the chain. It's also a lot more profitable to go chasing higher value markets, why try just sell corn to feed starving kids in a 3rd world country when you can feed it to cattle and sell the meat at a much bigger profit, equally so why try to sell liquid milk for less than bottled water when you can convince Chinese mothers they need to buy infant formula etc. The important thing to keep this whole show on the road is to ensure they have plenty raw goods at as low a price as possible, hence why you see government payments to support the "poor farmers", and the tagline "security of our food supply" makes it all look nice and all for our own good and not just about profits.

OK sorry I'll take off my tinfold hat now.

Base price

The 80 year old farmer probably has a more bio diverse farm as a result reduced stocking numbers. He may not have spread artificial fertilizer and the chances are his land hasn't been ploughed/reseeded in years. Schemes like GLAS are encouraging such farming methods & biodiversity - LIPP and traditional hay meadows.
Intensification is not the be and end all.

stantheman1979

Often thought about this myself. Of coarse it's an elderly farmers right to keep their land and farm it as they see fit. But it's a shame to see land turn rough because they haven't the energy to maintain it. Personally I hate seeing a weed or stone on my land maybe I'm OTT!! But the issue is the availability of land for young people. The price to lease land is prohibitive and buying land is out of the question.Farming is a great lifestyle and we need as many young people to the industry but it's impossible for young people to get started unless they're born into it or have a €million in the bank. In the U.K. most farms are rented and a young person can rent a farm. If they don't keep it properly they're out and someone else takes over. Not saying it's the way to go as most land is owned here but worth thinking about.

Cattlepen

Wildsurfer wrote: »

Cattlepen wrote: »

The man in his 80's might not be farming his land to its full potential but it's HIS land. He can do whatever he wants with it[/QUO
I knew this would be an emotive thread, questioning a farmers use of land! Look I'm not saying he can't do what he wants with his land, but when you see some farmers trying to turn mountain and bog into productive land it is hard to watch sound land going into disrepair. This older man has a farmer on his bounds milking 50 cows and a young family. Wouldn't it be nice to see him get an opportunity to rent even some of this land to try and expand his enterprise? But it's this mentality of trying to bring the land to the grave with you is what needs to change. All we all are is caretakers of the land at the end of the day.

Wait till your 70 or 80 and then tell us if your opinion is the same.

Cattlepen

Cattlepen wrote: »

Wildsurfer wrote: »

Wait till your 70 or 80 and then tell us if your opinion is the same.

And I don't post that trying to be catty. It's just something you won't understand till your older. Attitudes change with the ravages of time

Spanish Eyes

There are huge tax free incentives to letting land.

But you all know this already right.

I'm a city slicker with a country OH farming background.

We are looking into buying land and leasing it tax free. Better than having it in a bank for sure, and both lessor and lessee get a benefit. Sounds like a no brainer to me anyway.

Who2

Spanish Eyes wrote: »

There are huge tax free incentives to letting land.

But you all know this already right.

I'm a city slicker with a country OH farming background.

We are looking into buying land and leasing it tax free. Better than having it in a bank for sure, and both lessor and lessee get a benefit. Sounds like a no brainer to me anyway.

Did you seriously think about what your saying. If your cute enough to save the money to buy land then your sure as he'll able to do the figures, if you've been left it I'd be seeking the help of accountant.

Spanish Eyes

Who2 wrote: »

Did you seriously think about what your saying. If your cute enough to save the money to buy land then your sure as he'll able to do the figures, if you've been left it I'd be seeking the help of accountant.

What? Sorry I'm not sure what you're saying there.

Buy land. Lease it out. Tax free rental income depending on the length of the lease.

Leaves the rent a room scheme in the shade so it does.

Or buying an apartment here or abroad.

Helps other farmers.

What exactly is the problem here? Apart from the fact that this tax incentive is largely hidden away. But I'm on to it!

Who2

Spanish Eyes wrote: »

What? Sorry I'm not sure what you're saying there.

Buy land. Lease it out. Tax free rental income depending on the length of the lease.

Leaves the rent a room scheme in the shade so it does.

Or buying an apartment here or abroad.

Helps other farmers.

What exactly is the problem here? Apart from the fact that this tax incentive is largely hidden away. But I'm on to it!

What percent margin are you expecting and what size block of ground are you thinking of buying.

Timmaay

Spanish Eyes wrote: »

What? Sorry I'm not sure what you're saying there.

Buy land. Lease it out. Tax free rental income depending on the length of the lease.

Leaves the rent a room scheme in the shade so it does.

Or buying an apartment here or abroad.

Helps other farmers.

What exactly is the problem here? Apart from the fact that this tax incentive is largely hidden away. But I'm on to it!

250e rent divided by a purchase price of 10k/ac leaves you a ROI of 2.5%. 1400e/month rent in a Dublin 2bed apartment leaves you at 16k/yr, do your homework and you'll pick one up in around 150k in up and coming areas, ROI of 11%.

Spanish Eyes

Who2 wrote: »

What percent margin are you expecting and what size block of ground are you thinking of buying.

I get the feeling that you are trying to help me from making a big mistake or something. And thank you for that.

There will be no mortgage or borrowings to buy the land.

At least 50 acres possibly more.

Will research with the agent/vendor as to the viability of letting.

The margin will be total profit surely. I will not have any maintenance issues like with a property.

Thanks for your guidance. It just sounds like a good investment, and better than any other out there at the moment. Benefits everyone.

Spanish Eyes

Timmaay wrote: »

250e rent divided by a purchase price of 10k/ac leaves you a ROI of 2.5%. 1400e/month rent in a Dublin 2bed apartment leaves you at 16k/yr, do your homework and you'll pick one up in around 150k in up and coming areas, ROI of 11%.

But I won't have to do any maintenance. That's a killer. Phone call every month to fix this and that. And insurance and tenants that might wreck the place.

That surely will not apply to land.

Spanish Eyes

Timmaay wrote: »

250e rent divided by a purchase price of 10k/ac leaves you a ROI of 2.5%. 1400e/month rent in a Dublin 2bed apartment leaves you at 16k/yr, do your homework and you'll pick one up in around 150k in up and coming areas, ROI of 11%.

Sure, I need to find out how much per acre rent is now. I'm at the early stages of this. And am very happy to get some guidance. But there will be no borrowings.

Not even thinking of being a property landlord ever.

Would I need insurance of any sort for letting land?

Who2

Spanish Eyes wrote: »

I get the feeling that you are trying to help me from making a big mistake or something. And thank you for that.

There will be no mortgage or borrowings to buy the land.

At least 50 acres possibly more.

Will research with the agent/vendor as to the viability of letting.

The margin will be total profit surely. I will not have any maintenance issues like with a property.

Thanks for your guidance. It just sounds like a good investment, and better than any other out there at the moment. Benefits everyone.

500k investment for 10k a year . With that sort of coin you should be taking in 35-40 annually.

The part time boy

Spanish Eyes wrote: »

Timmaay wrote: »

250e rent divided by a purchase price of 10k/ac leaves you a ROI of 2.5%. 1400e/month rent in a Dublin 2bed apartment leaves you at 16k/yr, do your homework and you'll pick one up in around 150k in up and coming areas, ROI of 11%.

But I won't have to do any maintenance. That's a killer. Phone call every month to fix this and that. And insurance and tenants that might wreck the place.

That surely will not apply to land.

If you got a wrong fella taking the land place could be very worn down after few years . Then it be harder to find a new tenant

You prob also need public liability insurance at least . If there sheds on farm be better to insure them too.

Still more maintenance in a house than farm though . But the return is a big gap.

You can get a estate agent to let a house and let them deal with tenants and take phone calls of stuff broken etc .

If I had money I know what I would buy

Spanish Eyes

Thanks for the heads up folks.

I will think it out again.

I am not flush or anything, but have a few bob to play with.

You are putting me off now! But I know the advice is in the right place. Thank you for that.

Heading to leaba now.

If I need to ask more questions later would you answer me? I think you will. Thanks again. Will sleep on it.

carrollsno1

Early 20s here if i got the farm tomorrow the dairy farmers either side of it would be farming it simply because its tax free money, allows me to continue farm management, the dairy farmers would fence reseed and fertilize the farm for me at the end of a ten year lease i still have a sizeable asset and a ball of cash to allow me to enter dairying in my own right. Yes i would miss the sucklers but theres no hope in hell im going part time farming like my father did

Who2

carrollsno1 wrote: »

Early 20s here if i got the farm tomorrow the dairy farmers either side of it would be farming it simply because its tax free money, allows me to continue farm management, the dairy farmers would fence reseed and fertilize the farm for me at the end of a ten year lease i still have a sizeable asset and a ball of cash to allow me to enter dairying in my own right. Yes i would miss the sucklers but theres no hope in hell im going part time farming like my father did

I said the same about part time farming and here I am doing it now. Don't knock it there's good satisfaction in it. I like work so that probably helps a lot. Why is it also that dairy farmers are all thought of as the best tennants , the majority of the ones I've seen on rented ground, leave it in a bad way at the end of leases.