The FBT rent review: notices, timing and what the rent should be

Does the statutory review apply?

Look at the tenancy first. If it says the rent will not be reviewed, or sets out a review by a fixed amount or a formula that needs no judgement, the statutory review does not apply and the agreement governs. Otherwise either the landlord or the tenant can trigger a review by giving a statutory review notice.

When the notice must be given

A statutory review notice names a review date, and the timing works backwards from it:

• The notice must be given at least 12 months, and less than 24 months, before the review date
• The review date is usually at least three years after the tenancy began, or after the last review or change in rent
• The parties can agree in writing to review at different intervals
• If the tenancy names review dates, the review date in the notice must be one of them

What the new rent should be

The rent is the open market rent: what the holding might reasonably be expected to let for on the open market, between a willing landlord and a willing tenant, on the terms of the tenancy. Tenant’s improvements are disregarded, so a tenant does not pay rent on work they paid for themselves.

Evidence matters. Comparable lettings in the area, the Defra figures for farm rents by farm type, and the holding’s own buildings, cottages and diversification income all feed in.

If you cannot agree

Most reviews settle by agreement. If they do not, the rent goes to an arbitrator, appointed by agreement or, on application in the six months before the review date, by the President of the RICS. The parties can instead agree to an independent expert, which is usually quicker and cheaper.

Keeping the dates

The risk is the window. Miss the 24-month point and the notice is too early; miss the 12-month point and the next possible date is likely a year later. TenantTool keeps each farm tenancy with its term, rent and review dates, works out the earliest statutory review date from the tenancy, and puts the notice dates on the calendar.

Where this applies

This guide covers England. Wales, Scotland and Northern Ireland have their own rules, so check the requirements for where your property is.

Tenancies under the Agricultural Holdings Act 1986 have their own rent review rules. Take advice from your agent on any review.