With so many farmers and/or landowners leasing their property, it’s important to have a contract that clearly identifies the points of the exchange. From term to rate to liability, there are many issues to consider when negotiating an agricultural lease.
What all is included in an agricultural lease?
There are many different aspects to an agricultural lease. These include the term or duration of the lease, description of the premises, type of payment accepted, and information on liability.
There will be a set duration for the leasing contract. Short-term leases are typically for 1-2 years, while long-term can be for up to 5 or longer. There can even be some that are month-to-month. It should also state whether the lease can be renewed or extended and how to do so.
Description of the premises
This is an important section of the agricultural lease because the description needs to be written adequately. It should clearly identify what is being leased to avoid any confusion down the road. This description should include the address of the property, boundaries, current conditions of the property, and visual representations.
Rates for renting farmland can be based on many factors including land values and carrying costs. Whether crop-share or cash, either way, the lease contract must be clear to avoid issues down the road.
What happens if someone is injured on the property or the property gets damaged? These contingencies should be outlined in the lease, including which party is responsible for any repairs and maintenance.