A place in the country?
Fresh, clean air; plenty of open space; peace and quiet — these are just some of the reasons often given for choosing the rural life.
With the COVID-19 crisis bringing food security concerns to the fore, coupled with uncertainty over global trade deals and commodity prices, farmland and land suitable for forestry are being seen as a secure investment.
Interest isn’t just coming from new investors, but also from farmers and landowners looking to upscale and increase their profitability.
That coupled, with COVID-19 prompting new working patterns — employees are likely to permanently reduce the time they spend in the office and how often they commute — could mean a perfect storm with demand for rural properties far outstripping supply.
An O2 Business report conducted with ICM and YouGov found nearly half the workforce questioned think flexible working will increase. YouGov research showed while two in five employees currently live in a city, nearly half of the city dwellers (41%) would move to rural spots if they had the ability to work more flexibly.
The situation now
To illustrate, a small farm in Stirlingshire was put on the market earlier this month and, with a number of formal notes of interest already expressed, a closing date of 28 July for offers to be received has been set.
The true reasons for, and indeed the extent and longevity of, this increased demand for rural property remain to be seen.
As I've said before, the global pandemic, and empty shelves at the start of lockdown, highlighted the problem with long and complex supermarket food supply chains. That, along with people embracing homeworking and the desire to return to a simpler life, together with fears over food supply and security could all be motivating factors.
As a result, we may well see continual demand from people looking for opportunities for self-sustainable living in more remote properties with a reasonable amount of land, such as crofts or small farms.
For farmers and growers, the uncertainty surrounding post-Brexit trade deals and the opportunity of historically low interest rates may also mean more sizeable businesses look to expand their footprint to spread fixed costs and improve efficiencies. Particularly as they’re faced with the reality of cheaper, imported foodstuffs and higher export tariffs.
Often the purchase or sale of a rural property is a once-in-a-generation event, and whilst the mechanics of these property transactions may seem similar to purchasing or selling urban residential or commercial property — it is after all, a case of buying and selling land and what’s on it — there are many potential pitfalls.
They range from issues around boundaries, private water supplies, sewerage, access, use and planning as well as renewable energy installations and ascertaining the best structure and set-up for an agricultural business.
Using experts to help access agricultural and forestry grants and subsidies is also an important consideration.
As such, it’s important for sellers’ solicitors to act with land agents at the outset to prepare a thorough sales pack to avoid unexpected problems further down the line, and for buyers to seek expert advice to ensure these peculiarities of a rural purchase are fully understood.
For buyers, it’s well worth getting advice on all the options for funding a purchase too. It might be, for example, that high street lenders can’t assist, but alternative providers are well placed to step in.
Rural land and property remain a smart investment and people are voting with their feet. Demand is high and for those looking to retire or downsize now could be the perfect time. Either way the market remains strong, but it remains to be seen how things play out.