There are differences in the process of buying a rural property or farm in NSW, and the process of buying a residential home in the middle of town. The issues that can arise are numerous and varied. By commissioning searches and enquiries before you enter into a formal Contract you can minimise the risk of unpleasant ‘surprises’ on your rural property.
Structure & Compliance Reports on Improvements
A prudent purchaser should conduct the usual pre-contract inspections on the home and buildings on the rural land as they would in respect of a home or “town land”. This should include a timber pest inspection, a building inspection to discover any defects that are not usual “wear and tear” and appropriate enquiries to ensure that all improvements are approved.
Chemical Residues, Livestock & Plant Diseases, Noxious Weeds & Animals
If you intend to run a business growing crops on your land or raising livestock then the presence of a chemical residue in the soil could destroy your business. Organochlorines such as DDT were used extensively on farms to control pests and the residue can remain for decades in the ground and attach to plants and animals.
You may also want to get a soil test to establish firmly that there are no chemical residues in the soil.
Some diseases can stay on the land long after the animals are gone even for long periods of time after de-stocking. Protection zones often prohibit certain activities on farms if affected and may stop you from keeping certain types of animals or stock at all if a significant risk exists. A Local Land Services (LLS) search will disclose some information regarding this.
Specific types of crops can be affected by specific pests for example fruit fly and nematodes. In this case, a thorough investigation by an experienced horticulturalist is recommended and Local Councils may have officers who can assist.
Noxious weeds and pests can also be a problem on rural land. A search sent by us to the LLS (previously the Rural Lands Protection Board), can show any notifications or orders on the property for these issues.
A survey shows the dimensions and boundaries of the property and is particularly important when buying a rural property. Existing fencing may not be accurate and can give an incorrect picture of the actual land you are buying.
If a water source appears to be within the property and in fact it isn’t, a survey will show this error and you can negotiate for purchase of the property with this knowledge. If this is the only water source on the land, the result of not getting a survey might be devastating to you.
Infrastructure for your farm including the building of roads and bridges should be investigated and environmental considerations for your intended use of the land checked to make sure they comply with land use rules.
There are rules on what you can and cannot do on the land and these rules should be checked thoroughly before you buy a property, especially if it is for a specific purpose. Aspects of rural land use including development, agricultural use, irrigation and clearing are governed by the local council and state government agencies such as the EPA (Environmental Protection Authority).
A right of legal access must be confirmed before you buy a rural property.
Sometimes what looks like access may just be an easement or a stock route that can be changed and leave you unable to access your land. This should be checked particularly around Crown Land areas where there may be “enclosed roads” that look like normal roads but are actually owned by the government and can be closed at any time, possibly denying you access to your property.
The current plan of the land should be carefully considered for any “proposed” or “intended” easements or rights of way. Easements not visible on the land at the time of inspection but noted on a plan as approved may impact on your farm in the future.
Rural land without water is not as valuable. To protect your investment you should check whether the water resources are registered as required by local government and state law. Irrigation licences, water access from rivers and water bores may need approval. Dams should also be checked for compliance, if required, in the area in which you are buying.
A search can be obtained to show whether there is a current native title claim on the property and the extent to which this may affect your farming endeavours.
If you are buying rural land on which to run a business you should discuss your purchase of the land with an accountant experienced in rural taxation who can discuss with you the viability of the purchase and the tax issues associated with owning a farm.
Every rural property is different and it is important that you get the right advice and assistance before and after you enter into a contract to buy a property. Tetlow Legal understand the issues that are associated with both buying and selling rural properties in NSW and can assist you through these unique matters.