Revealed: how to buy a cut-price smallholding

Property correspondent Peter Trevail discovers that you can save thousands of pounds if you look for the right house and land.

I hate dealing with bureaucrats and their petty regulations and I've been threatened with legal action on more than one occasion for not toeing the line.

Local councils appear to write rule books with the sole aim of making our lives as complicated and miserable as possible.

I once extended a two-bedroom cottage, adding two extra bedrooms, and then had a run-in with the building inspector over the size of my septic tank. "You'll have to enlarge the septic tank," he told me, "because you're extending the cottage."

I replied: "But the same number of people will be using the tank. Why does it need to be enlarged?"

"Because," he insisted, "it is now possible for more people to live in the cottage and that will require more waste disposal capacity."

After a heated discussion I discovered that my existing septic tank was big enough for a three-bedroom cottage. So I picked up the plans, crossed out "Bedroom Four" and substituted the word "Study." I then insisted that the building inspector should go forth and multiply.

He agreed that I had found a solution to my problem. But it wasn't as simple as just changing the plans with a pencil and rubber. I would have to re-submit the architect's drawings, showing only three bedrooms and one study, and then wait for up to three-months for approval before he could issue the necessary paperwork to allow me to go ahead without enlarging the septic tank. I couldn't wait that long so I just had to bite the bullet and shell-out hundreds of pounds more on an already over-stretched budget.

Despite my hatred of rules and regulations, they can sometimes work to our advantage. Take buying a smallholding, for example.

If I told you that a bit of council red tape could knock £100,000 off the usual market price of a house with ten acres, wouldn't you - like me - suddenly become a convert to bureaucracy?

The "red tape" I am talking about is known as an agricultural tie. It is a planning condition that governs who can live in a house.

If you buy a property with an agricultural occupancy condition attached to it you are almost certainly going to have to demonstrate that you earn your living from agriculture or forestry. If you can't, the local council can take enforcement proceedings against you, leading to a court appearance and a heavy fine.

At a recent court case in Kent, a man who lived in a cottage with an agricultural tie but didn't comply with the conditions was fined £12,000 and ordered to pay £3,500 in costs.

Such planning restrictions, of course, severely depress the value of the property, which is great news if you're a smallholder looking to buy.

If you are genuinely interested in working the land and intend to stay put for the rest of your life, buying a property with an agricultural tie makes good sense.

It can knock as much as 25% off the unrestricted value of the property and that's a saving well worth having.

You are usually allowed to stay in an agriculturally tied property when you retire so there is very little to worry about providing you are sure that most or all of your income is going to be from farming your own land or working in an agricultural role in your immediate locality.

The law is fairly clear about what must be demonstrated to satisfy the agricultural condition. You can't, for example, live in the property if you work outside of farming or forestry and just keep some animals as a hobby or part-time occupation.

For example, a city stockbroker looking for a country retreat with some land, where his wife can keep her horses and a few chickens, is highly unlikely to get away with buying an agriculturally tied property. In this case, agriculture clearly would not be the sole or main source of income.

The majority of agriculturally tied properties are likely to be modern post-war bungalows, probably built to house a farm worker or a retiring farmer handing over the business - and the main farmhouse - to another member of the family.

They are properties that would not in normal circumstances have been given planning permission, but were allowed to be built because of the need to house a key agricultural worker or someone retiring from the industry.

The agricultural occupancy condition ensures that such properties are not built for spurious reasons and then put on the open market to make a quick profit.

It is possible, in certain circumstances, to have the condition lifted but councils are likely to require overwhelming proof that there is no longer any need for agricultural accommodation in the area and that all attempts to sell the property have failed.

An owner trying get an agricultural condition removed would need to demonstrate that it had been on the market at a fair price for a considerable time without success.

The owner of an agriculturally tied bungalow in Cornwall lost a planning appeal against the local council's refusal to lift the condition.

The council found evidence that although the property had been on the market at a fair price for a long time, the owner had not been helpful to prospective purchasers and had even turned down an offer at the full asking price.

The appeal inspector ruled that there had been "insufficient vigour" trying to sell the property. In other words, he twigged that the owners were trying to get the condition lifted just to enhance the value of their home.

The message is therefore clear: don't even consider buying an agriculturally tied property unless you are a seriously committed smallholder. It's not worth risking a long-drawn out and costly battle with the council.

But if you are a serious smallholder it's a good way to get a lot more for your money as a quick look at some of the agriculturally tied properties currently on the market shows.

Rural Scene, a Wiltshire-based firm of smallholding specialists, regularly handles the marketing of properties with agricultural ties throughout Britain and they have a number of attractive propertiers on their books at the moment.

Cwrt Y Castell at Brecon, Powys, is described as a 2.5-acre residential smallholding overlooking a beautiful small wooded valley within the Brecon Beacons National Park and only a few hundred yards from open common on the nearby Mynydd Mountain, where there are grazing rights. The modern chalet-style bungalow has four bedrooms and there is an integral garage.

Rural Scene are inviting best offers based on a guide price of £245,000, reflecting the fact that the property is subject to an agricultural occupancy condition.

Rural Scene are also marketing Maes-y-Deri at Whitland, Carmarthenshire.

This is a four-bedroom agriculturally tied bungalow with about 70 acres of land and the price guide is £450,000.

The property has attractive landscaped gardens and grounds with spectacular views across lovely countryside and includes useful outbuildings with stock pens.

Edward Oldrey, a director of Rural Scene, says buying a smallholding with an agricultural tie should not pose any difficulties providing the purchaser's main form of employment is in agriculture.

"From a smallholder's point of view this should not be a problem and it may well work in their favour, as tied properties will often be valued up to 25% lower than if they weren't tied."

More details about the agriculturally tied smallholdings featured in this article can be found at www.ruralscene.co.uk

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