At Moore Blatch, we regularly act for purchasers who are based in London and other urban centres who are looking to purchase rural homes and escape to the country. They may be relocating or looking to purchase a second property as an investment or lifestyle proposition.
Each property presents its own issues for the solicitors involved but there is a catalogue of issues that solicitors should commonly look out for when acting on the sale or purchase of rural property.
From experience of multiple rural transactions, we strongly believe it is essential to choose a solicitor who has a familiarity with transacting in rural land. If you choose the Rural Property team at Moore Blatch – then all the better!
Here are some non-exhaustive examples of the issues which we commonly see:
- Rights of way
You and your solicitors should look out for public rights of way across the property. Some of these would be identified by a solicitor’s suite of searches but also look out for evidence on site, such as gaps in hedges, gates and stiles.
- Stamp duty land tax (SDLT)
According to HMRC, SDLT is forecast to generate revenue of £15.2 billion per year to HMRC by 2022. SDLT on high value properties has steadily risen over successive governments and the second home surcharge, introduced in 2016, was an extension of this policy. However, particularly on rural properties, it can be possible to use lawful reliefs (such as the mixed use rate or multiple dwellings relief) to generate substantial SDLT savings. This requires a thorough analysis of the features of each individual property.
If parts of the property are let, the protection that the tenants have will depend enormously on their type of tenancy. It is possible that there may be service tenancies of outlying cottages or agricultural tenancies of parts of the land. Tenants under some types of agricultural tenancies enjoy extensive protections against eviction and/or compensation rights for improvements. If these exist, you will need advice from solicitors adept at managing and advising on these.
If there are employees at the property, such as gardeners or agricultural staff, this will also need detailed consideration.
Rural properties that are spread over multiple acres are far more likely to be unregistered at the Land Registry or be made up of a number of different titles. Your solicitor should check how these marry together. If the title plans are particularly complex, a walk around the site is a very sensible idea.
The title may contain multiple restrictive covenants which may affect the permitted use of the property and could potentially hinder any redevelopment plans, for example not to use the land other than for agricultural purposes. It is important to work out who has the benefit of these covenants and what the practical effect of them may be (if any). In some instances, it is possible to obtain insurance against an adjoining owner seeking to enforce one of these covenants.
Sporting rights are essentially rights to go onto someone else’s land and shoot, hunt or fish on it. If, like me, you live in London, you are almost certainly going to own the sporting rights over your home and in any event the risk of them being exercised would be minimal/zero. However, sporting rights over rural properties can be very valuable and cause practical inconvenience to the occupier of the property.
When transacting in sizeable rural property, it is important that the solicitors check if sporting rights are “in hand” (i.e. the seller owns them and has not let or licensed them to someone else). If these sporting rights are owned by a different party, solicitors and other advisers should try to check who owns them and how often they are or can be exercised.
- Unadopted roads
Rural properties are far more likely to be located off the publicly adopted highway network, with access often along private or shared access roads or tracks. It can be critical to know who maintains these private roads and who contributes towards their maintenance and repair.
Rural properties are far less likely to be connected to services such as mains drainage or gas. Electricity or other utilities may be fed along stretches of unadopted pipes or cables, which are not the responsibility of the utility company. Your solicitor should let you know what the arrangements are and your surveyor and insurer should be made aware of the existence of apparatus such as septic tanks.
It is not uncommon for electricity, water or other utility lines or pipes to cross rural property. Their existence is sometimes recorded in a wayleave agreement, which records the terms of their occupation. Sometimes a fee is payable by the utility company, which may or may not be collected as it is supposed to be. The existence of these wayleaves can restrict use or development plans but, on a positive note, may provide a little supplemental income.
These are just selection of issues we commonly encounter on rural property transactions. For more information, do not hesitate to get in touch.