Agricultural Rent Survey

Agricultural Rent Survey
 
Rents For Existing Tenancies

28 December 2015, words by Andrew Teanby

Rents for existing tenancies rose by an average of 19% at review.

 

Farm type

We surveyed rent reviews covering over 69,000 acres in the year to 30 April 2015. Rents increased in all sectors and by an overall average of 19%, which is lower than the 24% average for reviews conducted in 2014.3

Livestock rents increased the most, rising by 23%, but down from 25% in 2014; arable rents rose by 18%, down from 28%; dairy rents increased by 13%, down from 19% in 2014. The rents for mixed farms continue to increase by less than both predominantly arable and predominantly livestock units. Dairy rents increased the least, reflecting that milk prices (in real terms) have declined to levels last seen in 2007 due to global oversupply and the Russian ban on dairy imports from the European Union.

FIGURE 2

Rent review results by farm type in year to April 2015

 
Figure 2

Source: Savills Research

Tenancy type

FBT rents rose by 25% compared with 16% for AHA tenancies. For both FBTs and AHAs, livestock rents continued to increase particularly strongly in percentage terms. For arable rents, the rate of increase for FBT rents was nearly double that for AHA lettings. Dairy AHA rents have risen less than other farm types, reflecting the pressures mentioned above.

FIGURE 3

Rent review results by tenancy type in year to April 2015

 
Figure 3

Source: Savills Research. Note: The full database contains evidence from 4,000 rent settlements covering over 1,000,000 acres of land.

N.B. This is lower than the 22% increase headline as it excludes rents for new FBTs, which are covered in the ‘Rents for New Farm Business Tenancies’ section.

The new rent figure shows the average of new rents settled in the period. It should not be used as an average rent for this farm type (or tenancy or region).

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Key Contacts

Ian Bailey

Ian Bailey

Director
Rural Research

Savills Margaret Street

+44 (0) 207 299 3099

 

Andrew Teanby

Andrew Teanby

Associate
Rural Research

Savills Lincoln

+44 (0) 1522 507 312

 

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