Flexibility for the occupation of houses

A Court of Appeal decision suggests there is now more flexibility for the occupation of houses subject to an agricultural occupancy restriction than previously thought. 

This could have implications on those who may now qualify to legally live in such a property and in turn have a positive impact on its value.

The appeal in the case of Shortt v Secretary of State (2015) concerned the meaning of “dependants” in an agricultural occupancy condition attached to a planning permission of the property in which the Shortt family lived. 

The condition stated: “The occupation of the dwelling shall be limited to persons employed or last employed solely or mainly and locally in agriculture as defined by Section 290(1) of the Town and Country Planning Act, 1971, or in forestry and the dependants (which shall be taken to include a widow or widower) of such persons.”

The farm was run by Mrs Shortt, but her husband had an independent business which in practice supported the farm. In reality Mrs Shortt spent less than a day per week on the farm which had never made a profit. 

It was therefore questioned whether the family’s occupation of the property complied with the agricultural occupancy condition, as the husband and children were not financially dependent on Mrs Shortt as an agricultural worker.

However, the Planning Court and Court of Appeal decided the family’s occupation did comply with the agricultural occupancy condition.  This was on the basis that the reference to dependency in the planning condition did not have to mean financial dependency - the support provided to the family as a wife and mother meant that the agricultural occupancy condition was complied with.

On the face of it this may open up the possibility of properties subject to such a condition being sold on the open market to a much wider cohort of society than has been the case before, which in turn may increase the value of these properties. 

Conventionally it has been considered that because of the occupancy restriction, such a property would be worth about 30 per cent less than a similar property without such a restriction. This level of discount may now be brought into question.

However, this could be a double edged sword as in some instances the owners of such properties look to get the tie lifted on the grounds there is no longer any demand for the property subject to the tie.  But if the potential qualifying occupiers of the property are now rather more widely cast, it may be increasingly difficult to prove that demand no longer exists.

We will have to wait and see how the market interprets this new case law before we can detect its full impact on the type of people legally living in agriculturally tied property and the value of the property itself.

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