Opinion: Inflated land prices could turn a person to drink
© Tim Scrivener My boyfriend and I struck a pact to give up alcohol for January – and once again I can button up my trousers without breathing in.
The other effect was that I couldn’t get to sleep so easily, so I’ve been watching more television recently.
Aren’t there a lot of channels nowadays?
It takes ages scrolling through the “Men in Sheds” channel, the “Inane American Canned Laughter” channel, the “Women With Painted Eyebrows Brushing Their Hair” channel, to find what I like, which is basically anything middle class about home improvements and property prices.
See also: Find out average farmland prices where you live
About the author
I’m now an expert in the residential market.
I love seeing people make money from developing their home, but I also feel a sense of injustice that rising property prices are denying young people the opportunities that my generation had.
As a Generation Xer who owns Makita power tools and bought a house at a young age, I’ve been very fortunate.
Once you are on the property ladder it is easy to start heading up it.
It is much tougher for Millennials who have the same ambitions that I had, because there are no longer any rungs at the bottom of the ladder.
The market for farms and farmland is similarly problematic. The market functions at the top: once you own lots of land, it is easy to borrow against it to buy even more.
Young farmers only chance to step onto the farmland ladder is through Farm Business Tenancies and starter holdings.
An even bigger problem is the void between these two worlds – the farming ladder has three rungs at the top, one rung right at the bottom, and a huge gap in the middle.
I began my career on a council starter holding.
My business has grown a lot and has a high financial output per hectare, but I have only been able to expand through lots of small tenancies and cropping licences spread over several miles.
Land market is ‘broken’
Profitable crops are nothing like enough for me to fund the purchase of farmland. Tenants are imprisoned in a rent trap which they can’t break out of.
A healthy farming industry would have young people starting on small tenanted farms, but able to build up capital so they can get out in their 60s to make space for someone else to have a go.
But the land market is broken. The tax benefits conferred on land mean that its value is unrelated to its earning potential.
With residential property, owners get taxed harder if they live in a mansion or if they buy more than one house: badly maintained houses sell for less money.
Not so with farmland. Badly-farmed land is worth roughly the same as well-farmed land, and the more land you buy, the more money the taxpayer gives you.
We need a government that tackles this – with tenancy laws and taxes which put farmland in the hands of those who want to do something more useful than to just pass their wealth to their children.
If a landowner’s child is keen to farm, they should have to buy that land like anyone else would.
It is not just unfair, but evil that this government is raising the taxes on low-paid workers while still permitting land to pass tax free from one generation to another.
No wonder I’ve gone back to drinking again.