Partner, South West Estates & Farm Agency
It is vital that farmers and landowners are prepared when it comes to selling their farm, if they want the process to go as smoothly as possible.
Experience shows that pulling together all the required legal documentation, well ahead of the farm hitting the market, helps to shorten the gap between receiving an offer and exchanging contracts.
This is particularly important at present as farm sales are taking significantly longer to go through than when the market was at its peak.
Buyers and their professional advisers are typically taking a far more cautious approach before they sign contracts, wanting to ensure that every i is dotted and every t is crossed, before they commit.
If efforts have been made to gather information and paperwork together, two to three months before the farm goes on sale, it can make it less stressful for all parties.
The good news is most of the documentation required lies within the control of the vendor and should already be in the files held on farm.
The challenge is pulling it into one place so it can be shared with the seller’s solicitor, and in turn a buyer, in one go, rather than in dribs and drabs.
The paperwork that a potential buyer of a farm will want to see includes:
• Draft contacts
• Title plans
• Historic conveyances
• Tenancy agreements
• Sporting rights
• Acreage schedules
• Details of energy certificates
• Abstraction licenses
• Council tax records
• Local authority search results
• Listed building status
• Definitive plan of rights of way
• Basic Payment Scheme claims
• VAT registration
• Historic cropping records
• Broadband speed results
• Boiler safety certificates
• Agri-environment scheme agreements
• Draft overage provisions
Possible problem areas
There are a handful of areas where sellers need to be alert to minimise potential delays
For example, farm owners need to make sure they check that documents involving neighbours or third-parties, for example tenancy agreements, have all the required signatures.
Some properties are not still registered with the Land Registry and, while it is possible to sell farms based the old title deeds, it is easier if you have registered title before the point of sale. This process typically takes one to two months.
It can also take significant amounts of time for the results of some Local Authority searches to come through – in some cases 10 weeks or more.
It therefore can make sense for a seller to apply for the searches, rather than leaving it to the buyer. While there is a cost associated with this, it can be a worthwhile investment to avoid holding up a sale.
Strutt & Parker’s Estates and Farm Agency Department has local contacts based across England and Scotland who would be delighted to talk about any aspect of buying or selling farms and farmland.