Recently we've been asked a lot about Agricultural Occupancy Conditions, also known as agricultural ties, on properties – specifically what these are and, more importantly, whether or not they can be removed.
It's true that often a rural property for sale looks too good to be true, and buyers should always be aware of the possibility of an Agricultural Occupancy Condition (AOC).
What are Agricultural Occupancy Conditions?
An Agricultural Occupancy Condition, or agricultural tie, is a condition of planning, set by the council, which enables rural homes to be developed. With their introduction, local planning authorities were able to set aside their resistance to new home developments in the countryside and grant planning permission, where there is a genuine business need.
The key condition of an AOC is that the owners of the new property are either agricultural employees (and their dependants), or their widow or widower.
AOCs were introduced to address the variety of rural commercial operations requiring an employee to be available on-site 24 hours a day, which was only possible if the employee had live-in accommodation.
What are the issues with Agricultural Occupancy Conditions?
Although an AOC allows for rural homes to be developed, it reduces the value that they sell for on the open market.
So the greatest problem that agricultural ties pose to our clients is the substantial reduction in the value of their property, often up to 30%. Unsurprisingly, most prospective buyers are unable to comply with agricultural ties as they are not wholly or mainly employed in agriculture, and so the pool of available buyers is correspondingly small.
What can be done?
Fortunately it is possible to alter, suspend or discharge an AOC. The options are as follows, but it is not easy:
1. Apply for a Certificate of Lawfulness of Existing Use or Development (CLEUD), by proving that there has been a consistent and uninterrupted 10 year breach of the AOC that is still ongoing.
You must prove that you have not engaged in any agricultural work or recently retired from a job in agriculture. In this instance, the AOC is not discharged but it is suspended until someone later moves in and complies with the conditions of the AOC, effectively re-setting the 10 year period. It is not uncommon for councils to accept applications to remove AOC's completely once a CLEUD has been granted.
2. Where a property is at least 4 years old and not built in accordance with the original planning permission, there is potential to receive a CLEUD. This is on the basis that the property is technically not consented to and so the occupancy condition cannot be correctly applied.
3. Apply to a local council for the AOC to be removed or altered.
To do this you need to lodge an application with evidence demonstrating that the condition no longer serves a useful purpose. You will need to market the property for a period of at least 12 months at a price that accurately reflects the lower market value (taking into consideration the AOC). If you have not garnered interest in that period from prospective purchasers then you will have a strong case to present to the local council, who may then remove the AOC entirely.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.