Tuesday, 23 December 2014

The highs and lows of 2014

As 2014 draws to a close, now is the time to reflect on the highs and lows of the farming year which has proved to be a mixed bag.

The year opened with torrential rain and floods on the Somerset Levels which became international news, but as the rain stopped it gave way to one of the best periods of “growing weather” we have seen for some time. Arable crops generally yielded well, grass and maize grew strongly filling the silage clamps and barns with an abundance of good quality winter fodder.

Livestock also enjoyed the pleasant spring and summer and incredibly mild autumn, resulting in high milk production and beef cattle growing and fattening well.

However, good as the weather may have been, farmers have been buffeted by some extreme conditions on the commodity markets.

Beef farmers were the first to be hit as prices plummeted by around 20% in the first six months of the year. But since then, the market has firmed and the year ends with prices back by about 10% on a year ago with modest hope now emerging for a better 2015.

It was then the turn of arable farmers to feel the cold wind of falling world commodity markets as feed wheat prices slumped from around £170 per tonne in the spring to a low of around £100 per tonne in mid autumn. From there prices have thankfully improved somewhat, approaching £130 per tonne at the yearend.

However, the most unpleasant surprise of the year was the unexpected slump in milk prices which started reasonably gently, but in recent months has gathered pace with some dairy farmers now being paid as much as 10p per litre less than they were being paid at the start of the year. This remains a worrying situation and there will undoubtedly be casualties as the months go on and what is particularly worrying is that there does not seem to be an obvious end to this decline in milk prices.

Having said that, unlike other sectors, not all dairy farmers are suffering at the same rate because the price each farmer receives depends on the terms of the contract they hold with one of the numerous milk buyers in the market. This is demonstrated by the latest DairyCo data which shows the top monthly milk price offered in October was 36.7p per litre as compared to the bottom price of 24.98p per litre; a staggering difference for more or less the same commodity.

So, it has been a mixed year with generally good weather after a disastrously wet start but this has not been enough to offset the effects of falling commodity prices which will undoubtedly impact on farming profits in 2014. However, with oil prices also falling fast this should help reduce costs of production as we move in to 2015 thereby offsetting at least some of the effect of falling produce prices which have proved to be the dominant factor effecting farmers in 2014.  

James Stephen MRICS FAAV
Rural Practice Chartered Surveyor, Wells

T: 01749 683381
E: james.stephen@carterjonas.co.uk

Monday, 22 December 2014

Revenge evictions bid fails - but may return

You may remember in an earlier Clearer View we raised the issue of gas safety and in that article mentioned a Private Member’s Bill put before Parliament by Liberal Democrat MP Sarah Teather.

The Government agreed to back her Bill and allow it time to progress through the essential Parliamentary stages – but its second reading on November 28 was talked out by two Tory MPs who spoke for more than two hours until the Bill ran out of time.

However, it’s reported that Housing Minister Brandon Lewis is seeking a way to insert a clause to prevent so-called “revenge” evictions into the Deregulation Bill in January.

The Bill sought to ban such evictions by landlords of tenants who had requested repairs – once a repair had been requested, the Bill would have made it impossible to serve a Section 21 notice for repossession.

This restriction would also have applied where no valid gas safety certificate exists or where the tenant has not been given an EPC for the property but its failure in Parliament is no reason to avoid ensuring all necessary paperwork is valid and up to date.

EPCs are arranged at the point of marketing by all our branches. Our property managers arrange gas safety certificates for our managed properties and it remains a legal requirement for Houses of Multiple Occupation (HMO) to have a carbon monoxide alarm fitted. However, we advise all landlords to consider the installation of alarms to protect the occupier and help prevent any legal action being taken against a landlord.

Lisa Simon, 
Partner Head of Residential Lettings
T: 020 7518 3234 

Who is an “active farmer”?

Well that is a question that has been vexing a number of “farmers” for some time because under the new Basic Payment Scheme (BPS), it is only “active farmers” that will be eligible to receive EU support payments from 2015 onwards.

Up until now the definition of an active farmer has not been entirely clear and as a result there has been concern that for example, those farmers who have successfully diversified may no longer qualify as an active farmer even if they are clearly still farming in a reasonably significant manner.

However, what we have known for some time is that there is a “negative list” of non agricultural activities that will not qualify which are as follows:

  • airports
  • railways
  • waterworks
  • permanent sport and recreational grounds
  • real estate services

The first four categories seem reasonably straightforward but the fifth category has always caused concern, not least because no one understood what “real estate services” really meant. But now things have become clearer following DEFRA’s latest publication on the subject.

We now know that ‘operating a real estate service’, applies to professional property developers, real estate agencies and people managing real estate on a fee or contract basis.

However, what is perhaps of more importance to farmers is that renting out accommodation facilities on a farm, apartments or homes that are in a farmer’s private property for housing purposes, parts of buildings or surfaces on the holding and agricultural land to third parties will not count as real estate services. This should cover many potential diversification activities.

But, in addition farmers who operate any of the 5 non-agricultural activities may still qualify as active farmers if they meet one of 3 ‘re-admission criteria’ which are as follows:

- The farmer’s annual payments for the Single Payment Scheme or BPS (including the greening payment and any young farmer payments) are at least 5% of their total non-agricultural receipts in the most recent financial year

- The farmer’s total agricultural receipts are at least 40% of their total receipts in the most recent financial year

- The farmer has at least 36 hectares of eligible land

So it seems that after all this uncertainty and confusion, the simplest way to ensure you will always qualify as an active farmer is to farm at least 36 hectares or 89 acres. Why 36 hectares is deemed to be the magic number goodness only knows; it is just yet another of those bizarre interpretations of EU legislation but at least it will mean “active farmers” now know where they stand.  

James Stephen MRICS FAAV
Rural Practice Chartered Surveyor, Wells

T: 01749 683381
E: james.stephen@carterjonas.co.uk

Tuesday, 16 December 2014

Child safety should be the focus

Child safety is at the forefront when many people are shopping at this time of year but, professionally, it should also be a concern for landlords.

This is especially so in the home with regard to anything used for internal blinds or curtain tracks including, but not limited to, vertical blinds, roller blinds, Roman blinds, and plantation shutters which are now subject to 40 pages of regulations published by the British Standards Institution and based on European standards.

If that sounds over complicated, the British Blind and Shutter Association has a very helpful leaflet on-line that explains what’s needed - click here - where’s helpful video content and a downloadable explanatory pdf.

Where new blinds are being fitted, they must comply with the regulations and have built-in safety systems but where this is not feasible due to window shape or location separate safety systems can be used such as chain or cord tensioners.

In either case, there are regulations governing the lengths of cords or chains.

Properties where blinds are already installed can still be made safe – the relatively simple installation of cleats on which to wind cords when not in use may be an efficient and cost-effective solution to prevent young children being strangled in the loops created by cords or chains.

Of course, such devices are only effective when they are used. If your properties are furnished, cots, playpens, and other furniture should be placed away from windows to avoid children climbing up, an activity they all seem to love.

The regulations apply to all premises where children aged between 0-42 months are present or likely to have access – almost everywhere!

Our property managers are available to assist with adjusting existing installations and, where applicable, installing new blinds or curtain tracks.

Lisa Simon, 
Partner Head of Residential Lettings
T: 020 7518 3234 

Monday, 15 December 2014

Badger Culling

As the second year of badger culling starts in the pilot areas of Somerset and Gloucestershire I feel I must once again make comment on the perennial debate surrounding badgers and bovine TB.

Last year around 1800 badgers were killed in the two cull areas which was less than was required to reach the 70% target which has been identified by scientists as the appropriate proportion of the population which needs to be slaughtered so as to control the disease. This year around 930 badgers need to be killed in order to reach the 70% target which reflects the reduction in size of the badger population following last year’s cull.

The rights and wrongs of whether or not the cull should go ahead are endless but what is undoubtedly true is that the incidence of the disease in cattle has increased dramatically over the last 20 years to unacceptable levels.

For instance in 1996, approximately 2,250,000 cattle were tested for TB and in total 3,776 cattle were slaughtered as either a reactor or contact. In 2013, provisional figures indicate 8,393,303 cattle were tested and 32,620 cattle were slaughtered. The emotional and financial cost to farmers and the premature death of 32,000 cattle are matters which are often conveniently forgotten in this debate.

However, I would make two observations on the statistics above.

The first is that biosecurity measures on farm are taken very seriously by both government and farmers and before anyone says anything to the contrary the time and cost incurred by farmers in testing almost 8.4m cattle last year should not be underestimated. In particular it should be understood the test involves a vet injecting an animal on one day then the vet returns to “read” the test a few days later. This is a significant task which is costly for farmers both in time and money, even if no reactors are found.

The second point I would make is that a tenfold increase in reactors from 1996 to 2013 is a very serious problem and it is clear that biosecurity measures alone are simply not controlling the disease. The only logical answer to this is that there must be an outside reservoir of the disease which keeps on re-infecting the cattle herd and badgers have been identified as such a wildlife reservoir.

I cannot see how the disease in cattle can ever be brought under control unless the disease in badgers is also tackled. In this context a similar programme to that in cattle of testing and culling badgers would be ideal but this is simply not practical in a wild population. Vaccination is also a possibility and may well have an important role to play, particularly in healthy badger populations to prevent the further spread of the disease.

However, where the disease is prevalent in both cattle and badgers I can see no alternative at this stage other than controlling badger numbers, which in themselves have increased dramatically since they became protected under the Badger Act in 1992.

So, unpalatable as it may be to some, culling badgers is the only practical solution in the short term to bringing this disease under control and as DEFRA secretary Liz Truss said last week, “doing nothing is not an option”.  

James Stephen MRICS FAAV
Rural Practice Chartered Surveyor, Wells

T: 01749 683381
E: james.stephen@carterjonas.co.uk

Wednesday, 10 December 2014

A Clearer View - Voted #1 in the Top 20 Best Agency and Supplier for Ideas and Innovations

A Clearer View has been voted Number 1 in the Top 20 Best Agency and Supplier for Ideas and Innovations in Four-i, an industry publication from the Property Academy.

It placed Carter Jonas ahead of other agencies, Virgin Media and Google.

We will try to keep up the hard work so that you are always informed of changes in both legislation and what is regarded as industry best practice.

Lisa Simon, 
Partner Head of Residential Lettings
T: 020 7518 3234 

Housing Crisis vs Party Politics:

"We need all of their solutions and more. And we need them now"

The rather tiresome slanging match around the housing debate continues with Labour promising to build 200,000 houses a year (although that is still 50,000 short of what we need) and the Conservatives half that number by a slightly earlier date. Oh and the Liberals have thrown in half a dozen Garden Cities for good measure to annoy their Coalition partners who came out strongly against them after the recent Garden City Competition. Does anybody really believe any of them will deliver the numbers?

All sides have been careful not to specify how they would actually build these extra homes and since everyone knows that no Government has built the quantity (or quality) of housing we need since we abandoned the new towns programme and flogged off the council housing in the 1980's, these proposals would barely scratch the surface of the problem anyway. But some people are bucking the trend - for example Birmingham City Council are developing their own Council housing as well as carefully planning a new urban extension of 6000 homes, and the London Borough of Tower Hamlets is currently planning to build 150 much needed affordable council homes supported by the London Mayor.

So what to do?

We need to get away from the debate about brownfield or greenfield, about urban extensions versus urban regeneration, about Garden Cities being better than New Towns – the simple fact is that we probably need all of these solutions and more, and we need them now. However the issue is not as simplistic as it is painted: well designed low carbon housing in a sustainable well-connected greenfield location out of the flood plain might be preferable to poor quality Noddy boxes on brownfield land in a badly connected location.  Mayfair was once green fields.

We need to find new ways of building much more, decent, housing which is fit for purpose in the 21st century. To do this we will need to train up a whole new generation of skilled craftspeople. The debate needs to be taken away from central government and from party politics, and devolved to local areas. “People in Birmingham and Manchester know the real needs of their areas far better than those in Whitehall, but beyond our major cities there needs to be a return to regional housing targets.” The recent Lyons report contains a multitude of suggestions, but it will be interesting to see how many of these ideas see the light of day.


Infrastructure is such a vast and all-embracing term that it suffers from the great disadvantage that most people, including politicians, don’t really have much idea of its importance or what it means. But it is none the less important for that, and it creates real jobs and lasting value. Infrastructure isn't just about the grand engineering projects for roads, railways and runways beloved of headline-grabbing politicians, it’s also about softer elements such as green infrastructure, natural flood relief, biodiversity and healthy living corridors.

The abandonment of regional spatial planning has been nothing short of a disaster, because it has reinforced the already massively over-centralised UK economy. And the irony is that this is from a coalition government which has trumpeted the ‘New Localism’ as being the solution to all our urban and rural ills, while in fact it has just reinforced NIMBYism.
It is manifestly daft to have separate public inquiries into High Speed Rail 2 and the future of London’s air transport – they are intimately connected and they need to be considered together along with other regional spatial issues such as housing and economic growth areas. 

The need for joined-up thinking between transport, city renewal and urban growth is so obvious it shouldn't need to be stated. This is such an import issue it needs further discussion.

John Phillipps, 
Consultant, Masterplanning
T: 020 7016 0726 

Tuesday, 9 December 2014

Elizabeth Truss blinded by last year's stats

Last week I read a news item released from a recent government report entitled “Making the food and farming industry more competitive while protecting the environment”

The headline was that, “The UK agricultural industry is going from strength to strength in its contribution to economic growth, with new statistics revealing that increased production and prices boosted farming income to £5.6 billion last year”.

It was stated that total income from farming rose by 15%, between 2012 and 2013 as the industry stepped up its output of top-quality food.

Environment Secretary Elizabeth Truss said, “These figures underline that food and farming really is a powerhouse of the UK economy. From potatoes to poultry, our farming industry is showing that it is leading the way in producing top-quality food that is desired across the world. Our farming sector employs over 400,000 people and their success is helping us deliver the government’s long term economic plan.

We know British consumers value British food but we want UK farming to be a world-leader, exporting quality products far and wide as well as thriving on the home front. Our push for better food labelling across Europe is just one of a host of ways we are working to help this crucial sector to grow and drive growth.”

However, I do hope that Elizabeth Truss understands that this rosy picture represents a “snapshot” from the past, before the world commodity markets took a nose dive plunging many farmers in to a very different situation today from that which existed only a year ago.

It is true that in 2013 commodity prices were reasonably high and the weather in the UK was certainly better than was experienced in the very wet summer of 2012. So in general farm incomes did rise in 2013, but 2014 has proved to be a very different scenario.

First the beef sector plummeted during last spring and summer which was followed by dramatic falls in cereal prices. Both these markets have made modest recoveries in recent months but the dairy sector is in freefall, with many farmers now being paid 8-10p/litre less for their milk than they were being paid in the spring.

So I trust Elizabeth Truss is not being blinded by last year’s statistics and that she has real grasp of the difficult situation which is affecting many farmers in the UK at present. There may be little that she can do about world market prices but there are things government should do to ensure the retail giants are prevented from passing cost savings down the food supply chain in an unfair manner so as to bolster their dwindling profits at the cost of primary producers.  

James Stephen MRICS FAAV
Rural Practice Chartered Surveyor, Wells

T: 01749 683381
E: james.stephen@carterjonas.co.uk

Wednesday, 3 December 2014

Taking Stock

Last week saw three different professional firms come together at the Bath and West to address the problems currently facing the dairy industry as milk prices have plummeted in recent months.

The seminar entitled “Taking Stock” was hosted by land agents, Carter Jonas, the Shepton Vets and the Farm Consultancy Group (FCG). The aim of the event was to assess the strategies farmers can employ to survive the current difficult trading period and in general, despite the current problems the message was reasonably up beat.

The overriding message that came across from all three firms was the importance of a farmer understanding his business inside out and managing all aspects to keep costs of production under control.

In the last year or so, while milk prices were reasonably high it seems some farms may have taken their eye of the ball in this respect and Hollie Savage of Carter Jonas and James Shenton and Phil Cooper of the FCG all emphasised the need for farmers to analyse their business carefully, benchmarking their costs of production against competitors so as to identify where improvements can be made.

Similarly Paddy Gordon of Shepton Vets explained the importance of a farmer understanding all aspects of the herd’s health and importance of using your vet to provide regular consultancy advice rather than just calling the vet when an animal falls ill. In so doing Paddy illustrated how the cost of regular advice will be far outweighed by an increase in profits as mastitis can be brought under control and pregnancy rates increased.

Tom Ireland from Carter Jonas addressed other opportunities in relation of renewable energy issues in particular where he explained that there are still significant opportunities for farmers, although obtaining planning consent and locating an appropriate grid connection remain significant obstacles. However he also emphasised that as subsidies begin to fall, the profitability of a renewable energy installation will become increasingly reliant on understanding the farms energy needs and matching that to the electricity generated. This is because it will be increasing important to use your own electricity rather than exporting it to the grid because this will produce a much higher return.

So in conclusion, although it was acknowledged that some dairy farmers may leave the industry, the speakers were confident that the majority will survive. However, in order to receive a sensible return for the massive financial and time commitment required to run a successful dairy farm, hard work alone will not be enough; farmers will need a thorough understanding of their business and act to control costs in particular.  

James Stephen MRICS FAAV
Rural Practice Chartered Surveyor, Wells

T: 01749 683381
E: james.stephen@carterjonas.co.uk

Monday, 1 December 2014

Catch me if you can

Last Friday I considered myself beyond privileged to meet the racing legend Frankel, my hero horse. It was a magical day made possible by the wonderful Jim Power who, not only was the Stud Groom for Banstead Manor Stud for many years but also, significantly, brought Frankel into the world. Frankel, the progeny of Galileo and Kind, was foaled at the stud on 11 Feburary 2008. In chocolate terms, my day with Jim Power and Frankel and, later, at the Newmarket Foal Sales was like winning the golden ticket for the Willy Wonka Factory. I was in horsey heaven.

I asked Jim when Frankel started to stand out amongst the crowd and he described him as "a lovely natured foal who owned the paddock”. He has described him as a “straightforward yet sensitive horse, with a slight air of arrogance about him - really top class racehorses often have that character.”

On Friday, Jim was quick to spot the high earners of the day as the fluffy foals were led around the paddock including top selling foal, son of Sea The Stars, purchased by Shadwell for 450,000 guineas.

Frankel raced 14 races and won all of them. Owned by Prince Khallid Abdullah, he is the first horse to be Champion at two, three and four-years old as well being crowned the Cartier Horse of the Year for two successive years in 2011 and 2012.

Frankel’s unquestionable supremacy translated into the exceptional prices achieved when his first two foals were sold: the first in June 2014 for £1.15m, whilst the second broke Irish records a week ago when it sold for 1.8m Euros (about £1.45million).

Yes, so much is down to the dam as well as the stallion, and Ireland’s success was much owing to the talent of the filly’s mother, Finsceal Beo (‘Living Legend’ in English) who won The 1,000 Guineas in 2007.

But what does this have to do with the residential sales market? Friday - my amazing day – was, surprisingly, a slow day for Frankel’s foals. The TV cameras were poised, the hype had been mounting, but out of his four foals due to be sold, the first was withdrawn following an over-excited jig in his stable and the following three did not meet their reserve prices, albeit one was subsequently sold to a privately increased bid.

I asked Jim Power what would happen to these adorable un-sold off-spring? How could they have not sold, despite their parentage and the amazing selling skills of three, non-stop-incentivising-supremely-knowledgeable auctioneers?

The talent was there, the genes were excellent, what more could one want? I truly felt for the owners and the auctioneers. It was no different to how I feel when I have launched an exceptional house to the market but I don’t find the buyer immediately, despite knowing the quality of what I am selling and promoting it with absolute gusto.

Jim’s answer was that the owners would probably wait until the Yearling Sales to re-present Frankel’s offspring to the market in order to achieve their deserved sum.

This is the property market too.

There are absolutely beautiful houses which have been brought to the market this autumn but have failed to sell. This isn’t down to their quality, however. Ask any estate agent (who really knows their salt) and the resolute answer to the question of “when is the best time to buy?” is: “NOW!”

We’re not saying this because we’re keen to get Christmas sales up, it’s because for a fourth year in a row we have not experienced the autumn market we were expecting.

We are in a new cycle. January and February are now key selling months.

January takes off at a gallop following the Christmas family ‘get-togethers’. Country Life, Rightmove & Zoopla report an annual peak of website hits in the latter part of Christmas Day. Decisions are made around the roast turkey and crackers and the newly-focused buyers want immediacy. They do not want to wait until the daffodils come out before a house is launched to the market.

This is why NOW is the right time to buy. Like Frankel’s unsold foals, look at what is out there now - don’t let the great and the brilliant pass you by - your ideal house may have already been withdrawn from the market only to be launched to the market in a few months time for a higher price. Call your agent now to discuss what is currently ‘hidden’ from the market. Vendors are more likely to consider genuine and unambitious offers this side of Christmas before the starting gates open in January. Unlike the retail market, you are likely to find your better purchase deal in the run up to Christmas - if you are waiting for the January sales you need not apply.

Finally, in estate agency, we often hear the expression “if it’s not meant to be, it’s not meant to be” – this expression frustrates me more than any other. If you want something don’t let it lie in the hand of fate - go for it. If you want a house - don’t hang about. Don’t be reserved in showing your agent your keenness to buy. It is your enthusiasm that gives us confidence in you and your genuineness which we, in turn, convey to our vendors. Enthusiasm also puts you at the top of our contact list for our ‘discreet’ properties which we are lining up for early 2015.

So, whilst I’m throwing fate out of the equation with my previous paragraph, I have noted something interesting: Frankel was born on 11 February 2008; his first foal was born on 11 January 2014 and our racing hero was trained by the legendary trainer, Henry Cecil, who was born on 11 January 1943.

Noticed anything? Apparently number 11 is considered to represent the Master Teacher which is believed to be an inspirational guiding light - someone who is highly charged, very powerful and leads the world.

Caroline Edwards
Residential Sales, Long Melford

T: 01787 888622
E: caroline.edwards@carterjonas.co.uk