New Farmland Rental Negotiations Factsheet available
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EmailA new publication from MSU Extension reviews how to approach rent negotiation with potential and existing landowners.
Land is arguably your farm’s most vital asset. Whether you raise crops or livestock, all production activities can be traced back to a need for land. This need makes securing access to farmland a critical part of managing your business.
Negotiating to rent farmland can be challenging and overwhelming. Other farms may be competing for the same property, and landowners may not have a thorough understanding of production activities or how to value their land. You may feel uneasy about sharing details of your farm business, and market trends might create pressure to offer high rent payments.
The Farmland Rental Negotiations factsheet created by Michigan State University Extension reviews how to approach rent negotiation with potential and existing landowners. From first-time meetings to setting the stage for easier rental renewal conversations, this publication provides helpful tips to consider.
Negotiations are business meetings
Negotiations for farmland rental should be treated like any business meeting for your farm. Successful business meetings involve discussing how to achieve goals and working through any challenges that may arise. To ensure a successful meeting, preparation ahead of time is essential.
Initial meetings and first impressions
The key to negotiations starting out positively is to make a good first impression. Begin by establishing a good rapport. Offer your appreciation for having an opportunity to farm their property. Even a simple thank you demonstrates respect for not only an owner’s property, but for their time. A successful and sustainable relationship can be built around this good neighbor mentality of friendliness and appreciation.
When negotiations end and an agreement is reached
Successfully concluding negotiations means you’ve come to an agreement. A rental value or method of establishing it have been outlined. Property maintenance has been defined. Most importantly, both parties understand what is expected to fulfill their portion of this new rental relationship. Now you need to solidify this relationship and ensure it has an opportunity to last.
Rental agreements should be thorough but also flexible
Rental agreements are a contract. Contracts need to be built on openness and trust. These agreements also need to thoroughly address any major concerns that exist for both parties. However, it is impossible to prepare for every situation that might happen on a farm property. Flexibility can be constructed into any agreement by establishing an open process of how to help work through unexpected occurrences.
For more detailed information on each of the sections highlighted, download a copy of the Farmland Rental Negotiations factsheet today.
