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Virginia Cooperative Extension -
 Knowledge for the CommonWealth

2005 Land Lease Survey Report for Southwest Virginia

Farm Business Management Update, June/July 2005

By Daniel Osborne, (daosbor3@vt.edu), Extension Agent, Farm Business Management, Smyth County

In early 2005, Virginia Cooperative Extension conducted an agricultural land leasing survey in its Southwest District counties. About 5,400 surveys were mailed out to farmers and landowners in Southwest Virginia, and 211 responses were recorded. The results of the survey are summarized below. Because the fair value of land rent varies significantly with the circumstances, the information is intended for reference purposes only. For more information on farmland leasing, contact your local Farm Business Management Extension Agent.

Table 1: All of Southwest Virginia
Land Type Responses Rate***
    Average High Low
Pasture 164 $22.47 $100.00 $2.00
Cropland 66 $32.59 $100.00 $5.50
Whole Farm* 106 $23.91 $83.00 $2.00
Tree Farms & Orchards 14 $125.32 $225.00 $5.00
Stocker Cattle Rate Per Head Per Month 12 $5.02 $10.00 $2.00
Cow/Calf Pairs Rate Per Head Per Month 21 $7.77 $12.00 $3.00
Average Length of Written Leases 43 Months
Average Length of All Leases **21 Months
* "Whole Farm" generally includes buildings, cropland, and pasture rented as a single unit; however, tree farms and orchards were excluded from this category and reported as a separate item.
** Oral leases are not legally enforceable for more than one year at a time; therefore, responses that reported an oral lease for more than one year were changed to 1 year.
*** The rates are reported on a per acre per year basis unless otherwise specified.

Table 2: Bland, Smyth, Wythe & Washington County Region Table 3: Coalfield Counties Region Dickenson, Lee, Russell, Scott, Tazewell, & Wise Counties
Land Type Responses Rate*** Land Type Responses Rate***
    Average High Low     Average High Low
Pasture 37 $22.17 $100.00 $8.86 Pasture 29 $20.31 $60.00 $2.00
Cropland 18 $36.42 $70.00 $7.50 Cropland 5 $25.17 $48.00 $8.00
Whole Farm* 35 $24.31 $83.00 $10.00 Whole Farm* 22 $17.98 $60.00 $2.00

Table 4: Carroll, Grayson & Patrick County Region Table 5: New River Valley Region Floyd, Giles, Montgomery & Pulaski Counties
Land Type Responses Rate*** Land Type Responses Rate***
    Average High Low     Average High Low
Pasture 40 $30.44 $100.00 $6.67 Pasture 39 $20.07 $85.71 $6.40
Cropland 18 $31.00 $100.00 $10.00 Cropland 11 $17.07 $40.00 $5.50
Whole Farm* 15 $24.41 $60.00 $7.25 Whole Farm* 22 $26.98 $60.00 $6.40

Other Results

Landowner or tenant: About 49% of those responding said they were owners of the land being reported, and 51% said they were the tenants. Several said that they both owned land that was being rented and were renting other land.

Oral or Written: Only 27% of the leases reported were written, leaving the other 73% as oral leases. Twenty oral leases were reported as having terms longer than one year, which means that they were not legally enforceable. Virginia law requires leases with terms for more than one year to be written to be legally enforceable. To be legally enforceable, Virginia law also requires leases to be written if the total payments are more than $1,000, excluding payments for options to renew or purchase.

Tenant Obligations: The results of this survey showed the following for tenant obligations as part of the lease agreement: 28% were responsible for weed control, 31% were responsible for fertilizer which included lime in a few cases, and 37% were responsible for minor fence, corral, and/or building repairs. These results contradict previous surveys which showed that the tenant was responsible for weed control, fertilizer, and minor fence, corral, and/or building repairs in over 70% of the leasing arrangements. The author feels that the poor design of the survey instrument led to the under reporting of tenant obligations and believes that results from previous surveys hold more merit on this issue.

Landowner Obligations: The results of this survey showed the following for landowner obligations as part of the lease agreement: 6% were responsible for providing herbicides, 8% were responsible for providing fertilizer, and 16% were responsible for providing fence building supplies. Here again, the author feels that the poor design of the survey instrument may have led to an under reporting of landowner obligations.

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