Higher demand, coupled with a desire for additional income streams in the face of post-Brexit concerns, has made a farm diversification into letting cottages, barns and outbuildings more attractive.

However, before setting up a new venture it is important that you do your homework and get professional advice, explains Johanne Spittle, Director & Head of Litigation at Pearsons & Ward in Malton (part of Ware & Kay Solicitors in York & Wetherby).

Residential lets have been a popular investment for many years but the legal framework that governs private residential lets in England has become increasingly complicated over the last 10 years and is about to change again following publication of the Renters (Reform) Bill in May. This time the changes are radical with the abolition of section 21 ‘no fault’ evictions being just one of the proposals. Many landlords have decided that the proposed changes are the final straw and have decided to exit the private rented sector.

Whilst the changes do undoubtedly mean that in the future it will not be quite as straightforward to recover possession of your rental property, as long as you do your background checks thoroughly; take professional advice; do not attempt a DIY approach and factor in that you may be unlucky and not have to take a tenant to court, the exodus of landlords from the sector and reduction in supply of private rental properties together with an ever-increasing demand for properties to rent may mean that this is a good time to invest in a residential landlord venture!

The alternative for your residential property is the holiday lettings market which avoids the complexities of landlord and tenant law but has other pitfalls such as, depending on location, cash flow issues because of the limits of the holiday season in many rural areas. Again getting professional advice from a specialist and speaking to others running holiday let businesses locally is sensible.

If you are considering commercial lets such as to retail outlets or for light industrial use or storage, as with any tenancy, you must ensure that the correct legal documentation is entered into with the tenants to avoid them gaining ‘security of tenure’ protecting their occupation. Done properly you will be able to recover possession easily if you need the building back for your own use.

If you do need to go to court either to recover your residential or commercial property getting the documentation right at the outset will mean that it is easier for your legal team to obtain a successful outcome.

Whatever the nature of your lettings venture you will need properly drafted agreements; planning advice and advice on the tax and rating implications of the potential change of use.

For more information about farm diversification please contact Johanne Spittle on Malton 01653 692247 or email johanne.spittle@pearslaw.co.uk.