The last year of the Single Payment Scheme

This year is the last year in which farmers will receive EU support via the Single Payment Scheme and the deadline for completing this year’s application is beginning to loom on the horizon. This process should be reasonably straightforward provided there have been no major changes in the area of land being farmed but the impact of the reforms to the support system which will come in to force next year, need to be considered now.

This is because the new scheme, which will be known as the Basic Payment Scheme (BPS), includes new rules relating to so called “greening measures” which will need to be complied with in order that the farmer receives the payments in full. To the uninitiated the rules may seem reasonably straightforward, but in practice they are complicated and small changes in cropping patterns can have a major effect on whether or not the greening measures come in to force.

In simple terms the greening measures involve two main elements. First there is a requirement to introduce various levels of crop diversification if you farm over 10 hectares of arable land and second one has to introduce “ecological focus areas” (EFAs) amounting to 5% of your arable land if one farms over 15 hectares of arable land.

However, it is not as simple as that in that there are also a raft of exemptions which relate to the area of temporary or permanent grassland and how this area relates to either the total area of the farm or the arable area of the farm. These exemptions significantly complicate the application of the new scheme, particularly on relatively small mixed farms, many of which exist here in the West Country.

As a result farmers need to prepare themselves this year so that they know what crops need to be planted and in what proportions this autumn so as to be able to comply with the new rules.

As an example, last week I analysed one client’s cropping pattern and discovered that if he retained one particular field in grass next year rather than planting it to a crop, he could avoid both the crop diversification and EFA rules. If on the other hand he was to plant a crop in the land, my client would have had to comply with both the crop diversification and EFA rules.

What this means is that farmers need to plan carefully now for next year so as to minimise the impact of the new rules on their farming system, otherwise a relatively small change in cropping pattern could have a significant impact on their ability to comply with the new scheme rules next year and hence receive their support payments.

James Stephen MRICS FAAV
Partner
Rural Practice Chartered Surveyor, Wells
T: 01749 683381
E: james.stephen@carterjonas.co.uk

Section 21 notice simplified by the Appeal Court

It's not inevitable that the landlord/tenant relationship will reach a stage where serving a notice to end the tenancy is required - but sometimes it is unavoidable.

A wrong choice of the legislative section under which to serve the notice, and how the termination date was recorded in it, has been exploited by some tenants to swerve round the notice and continue occupation.

However, the Court of Appeal has issued a new decision on Section 21 of the Housing Act 1988 which governs notices (Spencer v Taylor [ 2013] EWCA Civ 1600).

The effect is likely to simplify serving notice to terminate statutory periodic Assured Shorthold Tenancy (AST).

In the case under appeal, the tenant argued that the notice to quit given under Section 21(4) was invalid because it gave the termination date as a Saturday when it should have been a Sunday and that the customary "saving provision" in the notice to ensure its efficacy made it uncertain as it provided two different termination dates.

Lord Justice Lewison, a leading property QC during his time at the bar, gave the leading judgment and dismissed the appeal. Firstly, he held that the two different dates provided by the use of the customary saving provision did not invalidate the notice. However, more interesting was that he also decided the notice served was valid under section 21(1)(b) of the act and so the landlord's expiry date, which was more than two months from the date of service, was all that was required.

Previously, it was considered that a notice under section 21(4) must be used where possession was required after the end of a fixed term tenancy and must give two months' notice to expire at the end of a relevant period.

This is no longer the case. The law now states that a landlord wishing to gain possession of a property let on an AST, which was a fixed term and has now become periodic, simply gives two months' notice in writing in accordance with the terms of the tenancy agreement and with section 21(1)(b). There is no need for concern with regard to working out the "period" of the tenancy.

Whilst the new law is good news, I still recommend that landlords are cautious as the case could be still be subject of appeal to the Supreme Court and there could be confusion surrounding the new case law.

Based on advice we have received from Pain Smith solicitors we suggest continuing to serve notices on behalf of our landlords that comply with section 21 (4)(a), at least for the near future.


Lisa Simon, 
Partner
Head of Residential Lettings
T: 020 7518 3234 
E: lisa.simon@carterjonas.co.uk

Price of milk cut

Three weeks ago Tesco cut its price of milk from £1.39 to £1 for four pints and since then Sainsbury’s and Co-op have followed, matching the price already offered by Asda, Lidl and Aldi. This price is equivalent to 44p per litre.

Then, a fortnight ago Morrisons not only announced it had made a £176m loss in the year to 2 February but also that it was planning to take Lidl and Aldi head on. This new policy is evidenced by their announcement that they will be cutting the price of their two litre “Meadow Park” pack to an equivalent of 42p per litre which it claims will make it the cheapest price on offer.

This was followed last week by and announcement from Sainsbury’s that its sales excluding fuel had dropped by 3.1% in the last three months. This is a substantial fall and what this seems to indicate is that despite the reported strength of the economy, we as consumers are still looking for good value and supermarkets as a whole have to be extremely competitive to maintain their market share.

This is of course good news for consumers because it means supermarkets are having to squeeze their margins to maintain sales but what concerns me for British agriculture is that it will not be long before the supermarkets will look to transfer some of their pain down the supply chain to farmers and other suppliers.

At present this does not appear to be happening in that the price farmers are being paid for their milk is at an all time high although this is partly because the price of milk products on world markets has also been very strong. However, there are signs that the tide may be moving in the other direction as indicated by recent auctions held by New Zealand based dairy co-operative, Fonterra. These auctions are a good indicator of world dairy commodity prices and at their last auction the global dairy price index dropped by 5.2%.

So with global dairy markets beginning to drift and a supermarket price war in progress, dairy farmers should perhaps prepare themselves for lower milk prices in the months to come. Having said that, the best dairy farms are making good money at present and should continue to do so provided they keep a close eye on their costs and ensure that their milk production system is aligned with the requirements of their milk contract.

James Stephen MRICS FAAV
Partner
Rural Practice Chartered Surveyor, Wells
T: 01749 683381
E: james.stephen@carterjonas.co.uk

Leaving your property empty could come at a high cost

More properties will be caught in the net of increased taxes following the Budget announcement this week. Particularly in London, where property values are at their highest, the extension of ATED (Annual Tax on Enveloped Dwellings) to property valuing £500,000 and above will affect the capital’s mainstream market. I anticipate that more owners of properties in a corporate structure might consider renting out their property rather than leaving it empty. This is one way of mitigating the tax which, on a property valued between £500,000 and £1,000,000, would cost £3,500 per year if left empty from April 2016.

See our press release '2014 Budget: Effect on Prime Residential Property market'


Lisa Simon, 
Partner
Head of Residential Lettings
T: 020 7518 3234 
E: lisa.simon@carterjonas.co.uk

Legionella checks could be vital

Most people associate Legionnaires’ Disease with exotic climates or big hotels and conference or leisure centres.

But it can be much closer to home than you think - quite literally if you have a wet air conditioning system, swimming pool, or open water tanks in your property.

If the property is let, to comply with the Health and Safety Executive’s Code of Practice, landlords need to ensure that the risk of exposure to legionella in the property is properly controlled and where necessary carry out a risk assessment prior to letting.

Legionnaires’ Disease is the result of legionella bacteria infecting the lungs. It is usually contracted through breathing in small droplets of contaminated water. It is not contagious and cannot be spread directly from person to person.

Legionella bacteria is commonly found (often in harmlessly low numbers) in sources of water, such as rivers and lakes. However, the bacteria can rapidly multiply if they find their way into artificial water supply systems such as air conditioning.

Large buildings such as hotels, hospitals, museums and office blocks are more vulnerable to legionella contamination because they have larger, more complex water supply systems in which the bacteria can quickly spread. But with the increasing complexity of domestic properties, the threat should not be ignored.

Carter Jonas' heads of lettings and property managers have Legionnella and, Water Safety training and where they identify possible risk of Legionnaires’ Disease, will recommend an external consultant to carry out a risk assessment.

For more information visit The Health and Safety Executive’s Code of Practice.


Lisa Simon, 
Partner
Head of Residential Lettings
T: 020 7518 3234 
E: lisa.simon@carterjonas.co.uk

What's next after the Cheltenham Gold Cup...

As the cheers from the “Gold Cup” crowds at the Cheltenham Festival start to fade, all eyes turn to the next great event in the horse racing calendar – no not the Grand National but Mendip Farmer’s Point to Point.

OK this is a slight exaggeration but this Sunday sees our local point to Point run at Ston Easton. Clearly it is not quite up to Cheltenham standard but it is an opportunity for you to experience horse racing on your doorstep with a friendly atmosphere where horse racing enthusiasts mix happily alongside those who have simply come for a fun family day out.

Anyone who hasn’t been before really should come along to experience the race course excitement. There is the pre-race anticipation as the horses are walked around the parade ring, then placing your bets at the bookies followed by the race itself and then drowning your sorrows or spending your winnings at the bar! For those who do not want to lose their money at the bookies they can always invest it more with more certainty at the trade stands while children can play on the various rides and other attractions. So there is entertainment laid on for the whole family.

However to enjoy the day to its full it is interesting to understand that the sport of steeplechasing has a long history spanning over centuries. The first Steeplechase ever was run between the villages of Buttevant and Doneraile, County Cork in 1752 when Mr. Blake challenged his neighbour, Mr. O'Callaghan, to race across country between Buttevant and Doneraile churches or from “point-to-point”. In the four and a half mile race they jumped stone walls, ditches and hedges and by keeping the steeple of the church in sight, both riders could see their finishing point, hence the term steeplechasing.

In the following 100 years or so the sport caught on more widely and in the 1880s a formal racecourse was established on Mendip at Rudge. In 1931, the course was moved approximately a mile to Nedge, the well-known ridge of land laying to the south of Chewton Mendip. Races were held here until 1991 when they moved to near the Castle of Comfort and finally to Ston Easton in 1999, returning to almost where it all began, nearly 130 years ago.

Over the years the Mendip community has shown great success in producing top horses in the field of Point to Pointing, progressing onto hunterchasing and National Hunt racing. During the 1970’s, local farmer Max Churches produced top horses such as Rich Rose and Panmure, both of whom won hunterchases. In more recent years, we have seen horses such as Double Silk, Earthmover and Double Thriller, all of whom reached the top of the hunterchasing field, progressing into the higher reaches of National Hunt racing.

So why not come along to enjoy the excitement of the races in a friendly and informal atmosphere which is steeped in rural tradition.

James Stephen MRICS FAAV
Partner
Rural Practice Chartered Surveyor, Wells
T: 01749 683381
E: james.stephen@carterjonas.co.uk

Out of the blue... a rural planning policy

Last year, quite out of the blue, the government published a consultation document that has largely been ignored by the popular press but which may turn out to be one of the most fundamental reforms we have seen in rural planning policy in recent years.

Amongst other things, the government proposed that the conversion of up to 450 square metres of redundant farm buildings in to up to three houses of no more than 150 square metres each would be allowed under permitted development rules. Indeed it was further proposed that existing buildings could be demolished and a brand new house built on the same footprint.

Anyone who has been involved in trying to obtain planning consent to convert a redundant barn to a house or to build a new dwelling altogether in the countryside, will find the concept of such development being allowed through the permitted development regime, quite flabbergasting. Accordingly many observers had expected the proposals to be significantly modified.

Since the consultation ended last October, there had been deafening silence from government until last week when in response to parliamentary questions, Planning Minister Nick Boles reassured MPs that, “The Government is well aware of the arguments being put forward to exempt National Parks and Areas of Outstanding Natural Beauty from proposals to introduce permitted development rights for redundant agricultural buildings.” This raised speculation that in other areas outside these protected zones, that the Government may be minded to go ahead with the proposed changes.

And so when Nick Boles delivered a written statement to Parliament on 6th March it was not entirely a surprise when he wrote, “These reforms will make better use of redundant or under-used agricultural buildings, increasing rural housing without building on the countryside. Up to 450 square metres of agricultural buildings on a farm will be able to change to provide a maximum of 3 houses.”

He also went on to write, “We recognise the importance to the public of safeguarding environmentally protected areas, so this change of use will not apply in Article 1(5) land, for example national parks or areas of outstanding natural beauty. However, we expect national parks and other local planning authorities to take a positive and proactive approach to sustainable development, balancing the protection of the landscape with the social and economic wellbeing of the area”.

Nick Boles also explained that a “prior approval” process will be required where issues such as highways matters and flood risk will be taken in to account. There may also be other requirements or consequences of taking advantage of these new rules and so we await the detailed rules with interest which should be published by early April when the new regime is due to come in to force.

Possible requirements which were muted in the consultation document were that other permitted development rights would be withdrawn for a period of years thereby making it more difficult to erect a farm building elsewhere on a holding that has taken advantage of the new rules.

Not withstanding this, these new rule changes will present a significant opportunity for many farm businesses and if anyone would like further advice on the matter please do not hesitate to contact James Stephen on 01749 683381.

James Stephen MRICS FAAV
Partner
Rural Practice Chartered Surveyor, Wells
T: 01749 683381
E: james.stephen@carterjonas.co.uk

Short Listed for the ESTAS 'Estate and Letting Agent Awards 2014'

I am delighted to report Carter Jonas Residential Lettings have been short listed for the ESTAS ‘Estate & Letting Agent Awards 2014’.

The ESTAS determines the best estate and letting agents in the country through research carried out amongst their Clients about the service they have received from their agent.

This year 32,000 surveys have been submitted and we have been short listed for four Regional Categories and ’ Best Medium sized chain’.

The results will be announced by Phil Spencer, TV Property expert at the 11th annual ceremony on 9th May 2014. We are thrilled to have been shortlisted and are very grateful to our Clients who took the time to complete and submit surveys regarding our service.


Lisa Simon, 
Partner
Head of Residential Lettings
T: 020 7518 3234 
E: lisa.simon@carterjonas.co.uk

"I Heart Suffolk - that's my motto!"

Those of us born and bred in Suffolk have known about this county’s bewitching nature all our lives but the word is out. Recently described as a county “with apples in her cheeks”, our rural charm and undulating beauty now effortlessly blends with the sophisticate. London may be the cosmopolitan cocktail but Suffolk’s the cherry on top.

The attractions of Suffolk can easily be taken for granted by those who live and work here already but those new to the area will inevitably remark how colourful the houses are – an eclectic mix of charming painted cottages, elegant red brick and white brick Georgian houses and mansions, drunken timber framed houses in abundance, as well as pastel coloured beach huts.

We’re synonymous with pretty villages, rural hamlets, bustling market towns as well as the exceptional beauty of our unspoilt coastline and rugged, muddy rivers - bucolic scenes all perfectly captured by Constable and Gainsborough.

Suffolk was once a preferred destination for retirement – especially for those looking to move from the expensive Hertfordshire/Essex borders for a more peaceful way of life. Similarly, buyers migrated south from Scotland and Yorkshire to get that much closer to their family and friends in London. Quick research on the Internet will show we remain the most affordable county within that all-important 60 mile radius of London.

No motorway crosses our county yet we have excellent road and rail communication links to London and employment hot spots such as our hi-tech, high-powered, neighbour Cambridge. Added to which, Stansted Airport in Essex is a very accessible convenience whilst being far enough removed for noise pollution to be of no concern.

However, in the past five years, London has swivelled its searchlight north eastwards and hungrily shone its beam on Suffolk unveiling our hidden jewels.

We’re no longer the closely guarded secret we once were. Our high quality of life sees us top of the league in the UK’s longest life expectancy and, not only are we the driest county, we’re one of the sunniest in the UK too.

Niceties as these are, it is our top-rated schools and ease of commuting (under one hour to Liverpool Street) that seals the deal for our London buyers.

But we must definitely not forget Newmarket, the world famous home of British horseracing, which generates £208 million per annum and is also home to Frankel – universally known as the highest rated and most famous racehorse in the world. Since retiring from an unbeaten record of 14 wins out of 14 races and valued at £100 million, Frankel now stands as a stallion for Juddmonte Farms at Banstead Manor Stud commanding an impressive income of around £10-£12 million per year.

Maybe Frankel’s magic has rubbed off on the rest of us or maybe Suffolk’s new found celebrity put that extra heat into his heart and hooves as he raced to all his winning glories! Either way, a horse of such surprising and exceptional magnitude pretty much sums up Suffolk: stunning in all its discreet, yet unquestionable, splendour.

I heart Suffolk – that’s my motto!

Caroline Edwards
Partner
Residential Sales, Long Melford
T: 01787 888622
E: caroline.edwards@carterjonas.co.uk

"Events, dear boy, events."

Asked when he was Prime Minister what he most feared, Harold Macmillan responded with the now-famous quote: “Events, dear boy, events.”

The circumstances in which, about what and to whom ‘Super Mac’ was referring have never been established once and for all as the Profumo Affair (there’s one for the under 50s to google) but it’s a sentiment with which we can all sympathise.

No matter how much or to what level of detail we undertake research and prepare for or forward plan – even for an anticipated crisis scenario - events have a nasty habit of taking over.

Just ask the current Prime Minister. For all the expert advice from policy wonks and spin doctors in order to control the political messaging and the news agenda to the nth degree – it rained. And it rained. And it rained again. And it’s still raining.

Eighteen months out from David Cameron’s first General Election in-residence, the rain began. From where we are now, coming towards the end of the winter, an administration whose first term in office looked all set to be defined by austerity and, latterly, recovery, risks being overtaken and characterised – even caricatured – by a lack of both sandbags and ministers and state officials in wellington boots in the early days of the flood event.

Events are a great leveller for those in public life. Tony Blair’s premiership became characterised by wars in Afghanistan and Iraq and was defined by the terrible milestones of the 9/11 and 7/7. Not at all what New Labour had in mind on assuming power in May 1997 - no amount of political planning and message control freakery could have anticipated those terrorist events or their lasting impact.

The Bank of England policy, ‘Forward Guidance’ – whose feel-better factor I welcomed in these pages at the end of last summer – has also succumbed to events.

As the unemployment rate in January and early February looked like it was edging forward to that magic 7 per cent figure (as it turned out, it’s currently 7.2 per cent) which would mean that, under Forward Guidance, the Bank would have to take a view on increasing interest rates, Governor Carney announced that other variables were part of the interest rate policy too.

To be fair, Mark Carney was at pains to point out last August that 7 per cent was not a target at which point interest rates would definitely rise.

The direction of travel of interest rates is far easier to anticipate and prepare for a change of course than the unpredictable precipitations of Atlantic storms and the direction of the pesky Gulf Stream in winter 2013/14.

Yet not all big events are surprises. Under the Fixed-Term Parliaments Act of 2011, for the first time we’ve known exactly when the next General Election will be – 07 May 2015 – and plans will have been well underway for at least four years by the time it comes round.

This year sees another big constitutional event - some might argue the biggest since 1801 – the Scottish Independence referendum.

If, in line with a quote attributed to the US’s longest serving First Lady Eleanor Roosevelt, ‘Great minds discuss ideas; average minds discuss events; small minds discuss people’, the debate about Scotland’s independence and the accompanying political and cultural stushie has got the lot.

September 18 is bound to rain on someone’s parade.

Will Mooney MRICS
Partner
Commercial, Cambridge