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Agricultural Occupancy of Rural Houses

Colin Clark, a partner and head of agriculture and estates at Pagan Osborne, comments on the issues surrounding countryside housing and 'agricultural ties'.

"Many farmers will be familiar with what is often referred to as an ‘agricultural tie’ which is frequently imposed when planning permission is given for a new house on the farm or in the countryside. It is notoriously difficult to get permission for new houses in the countryside as most councils have policies which do not allow new houses to be dotted around the countryside preferring development in existing communities.

"These policies can cause difficulties when, for example, parents want to retire and move out the farmhouse but still live on the farm or if as son or daughter comes home to farm and needs a bigger house than one of the cottages for their growing family. There are also situations where a new house is needed for a farm worker when perhaps a new intensive livestock or fruit growing enterprise is established and there is no other suitable accommodation on the farm.

"In these circumstances planning permission can be obtained but usually subject to a planning condition which restricts the occupancy or use of the new house to someone employed or last employed in agriculture or sometimes forestry and therefore ties the use.

"To ensure the planning condition is complied with and applies to future as well as the current owners a separate agreement is usually required by the council. These are sometimes also referred to as Section 50 or Section 75 Agreements, being named after the relevant sections of the Town and Country Planning Acts which applied at the time planning permission was granted.

"A house with an agricultural tie is much more difficult or, in some cases, more or less impossible to sell on the open market and, even if an agricultural buyer could be found, they are most unlikely to obtain a conventional mortgage for a property with such a restriction on its use. The value of these houses is therefore lower.

"In some cases, if circumstances change, it is possible to apply to the council to have the restriction removed but the council are naturally reluctant to do so as planning permission was only granted in the first place because the house was needed for someone employed in agriculture. 

"However the situation regarding such agricultural ties may be changing.  A letter issued by the Scottish Government’s Director and Chief Planner to the council Heads of Planning in November last year stated that “The Scottish Government believes that occupancy restrictions are rarely appropriate and so should generally be avoided”.

"Encouraging vibrant rural communities, good design, suitable locations and the environmental impact of new builds are important in determining whether a new house in the countryside is appropriate or not and it should not be necessary to impose formal mechanisms to restrict occupancy.

"Anyone who is currently applying for planning permission where the council is trying to impose an agricultural tie should be aware of this guidance and resist the imposition of this type of condition. Those whose properties are already affected by an agricultural tie may find there is an opportunity and more favourable environment at present to apply for the restriction to be removed.

"Another general point in relation to new Section 75 Agreements is that following legislation introduced last year it is now possible for the owner of the land who originally entered into the agreement to continue to be liable for implementing its terms even after they have sold the land affected. It is therefore important to exclude this from happening when revising these agreements."

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