To Rent Land or Not?

TheClubMan

I'm thinking of renting out 45, possibly 50 acres to a neighbouring dairy farmer due to health reasons. The land is free draining but it does need attention. I'm currently waiting on soil sample results but it does need to limed and reseeded for the most part and some fencing too. The question is do I carry out this work myself before I rent it and charge more or let him carry out the work and charge less for rent? The term will be 5 years as my son is unable to commit at the moment but is interested in farming after travelling and I will review the lease when the term is up. Advice greatly appreciated.

C0N0R

Is that you dad??!

I personally wouldn't do any work before renting it, you could have the place reseeded and in top condition and he could rape it, give it at a fair price and then if he wishes to reseed etc I would offer to pay for some of that, that way he has a vested interest in it and is more likely to keep it better if that makes sense.

Mooooo

Rent as is and if he wishes to reseed it perhaps have the first years rent at a reduced rate?.

HcksawJimDuggan

TheClubMan wrote: »

I'm thinking of renting out 45, possibly 50 acres to a neighbouring dairy farmer due to health reasons. The land is free draining but it does need attention. I'm currently waiting on soil sample results but it does need to limed and reseeded for the most part and some fencing too. The question is do I carry out this work myself before I rent it and charge more or let him carry out the work and charge less for rent? The term will be 5 years as my son is unable to commit at the moment but is interested in farming after travelling and I will review the lease when the term is up. Advice greatly appreciated.

I'm sure you're aware of it but just to point out that there is an income tax exemption on €18,000 per annum for leases of 5 + years

Siamsa Sessions

Look up the lease the Farmers Journal has with that farmer in Tullamore for their demo farm.

The Editor spoke about it on the open day and they seem to have covered lots of the issues, incl. investments on the farm, entitlements, rent reviews, etc.

They have a clause in the lease too re soil fertility: the Journal soil tested the place before they took over and will have to pay penalties if they hand it back in a worse condition than it was in advance.

The part time boy

Tbh i think it mostly depends on what the neighbour is like and what kind of farmer he is .

The journal deal with paying penalty for giving back land in worse state is all well and good on paper . But worth feck all in real life.

To be fair if the Journal gave it back in bad knick they would pay up . But the fact is in fairness they keep it well. A lad thats not going to look after the land Will they you go whisle for it

If your neighbour is going to look aftrr it do the work . If his not leave it the way it is

kk.man

In my experience it's all down to the soundness of the man that you intend to rent it to. The rest in an ideal world is secondary.

George Sunsnow

Rent the land as is
Let him do whatever reseeding etc is needed
Get it valued

I thought you could earn up to €40k p.a Tax free if the lease is greater than what 7 years?
It sure beats milking cows if you've no borrowings/commitments

Then again You'd need something to do or you'd go mad

rangler1

The part time boy wrote: »

Tbh i think it mostly depends on what the neighbour is like and what kind of farmer he is .

The journal deal with paying penalty for giving back land in worse state is all well and good on paper . But worth feck all in real life.

To be fair if the Journal gave it back in bad knick they would pay up . But the fact is in fairness they keep it well. A lad thats not going to look after the land Will they you go whisle for it

If your neighbour is going to look aftrr it do the work . If his not leave it the way it is

I wouldn't agree, the rent will be based on the condition they take it in, rent it out and stand back.....no one made them give more than they should have

The part time boy

rangler1 wrote: »

I wouldn't agree, the rent will be based on the condition they take it in, rent it out and stand back.....no one made them give more than they should have

No point in doing up grades if the farmer taking the land does not look after. Yes you might get a higher rent price but 5 yeara latter you left with land that needs up grading again

rangler1

The part time boy wrote: »

No point in doing up grades if the farmer taking the land does not look after. Yes you might get a higher rent price but 5 yeara latter you left with land that needs up grading again

This is the value of the lease as opposed to the old 11 mths system, You will be surprised by the level of liability which is put on the lessee by the master lease agreement.

Hard Knocks

rangler1 wrote: »

This is the value of the lease as opposed to the old 11 mths system, You will be surprised by the level of liability which is put on the lessee by the master lease agreement.

Plus as the leader you're not afraid to spend on things like lime, fences, drinkers etc compared to the 11mth