Benefits of Leasing Property (Part 2 of 2)

By: Patina Thompson

Leasing lands in today’s volatile real estate market can be beneficial to a well versed tenant. Tenants can enjoy the continued productivity of farming while avoiding the ups and downs associated with land values. Quality wins out in this instance, because even with fluctuating commodity prices, good land can still grow good crops.
The tenant still has to be educated and cautious when entering into a lease contract. Both parties should identify their responsibilities clearly. Rented land could be made more productive with improvements which often increase the value of the land, can improve irrigation system efficiency and allow the tenant to increase productivity. Such improvements are typically the financial responsibility of the landowner but sometimes a tenant may be reimbursed for improvements with prior written approval of the Landlord. One drawback could come up if you have a year-to-year lease. The improvement may add a more permanent value to the property that the tenant cannot reap during the term of the lease. Such improvements, when practical, cannot be removed by the outgoing tenant.
Our team at Scythe & Spade is dedicated to protecting both the landowner and tenant with a well developed lease. The lease should outline which party is responsible financially in different situations and who is going to physically maintain existing and future structures. A “standard” of how the property should appear should also be addressed in the lease. The tenant should also consider who is responsible for paying water assessment fees, property taxes or other applicable fees according to each situation or location. It’s important to keep detailed records of such transactions. Maintenance of systems and structures on the property are also responsibilities of the tenant, of which time and money also play a factor. 
In any case, a Landlord and Tenant relationship should be open, honest and economic for all those involved. Give us at Scythe & Spade a call to see how we can help you and build a solid lease that can benefit you for years to come. After all, a good lease on good land can grow good crops.