The process of buying a rural property or farm is a little different to buying a residential
house in town.
A prudent purchaser should conduct the usual pre-contract inspections on the home and
buildings on the rural land. This should include a timber pest inspection and a building
inspection to discover any defects that are not usual “wear and tear”. Any issues of
concern in these reports should be followed up with licensed tradesmen where required.
In addition, as with “town land” the buyer must beware and will risk financial loss if the
proper investigations are not done before entering into a contract.
One of the major considerations when buying rural property is whether the purpose you
are buying the property for fits the use allowed by the local council and other state
government departments. It is a costly mistake to buy a property say for aquaculture in
an area that does not permit that type of agricultural pursuit, or the area may have
chemical residue which will destroy your organic farming intentions.
By commissioning searches and enquiries before you enter into a Contract for Sale you
can minimize the risk of hidden “surprises” on your rural property.
Chemical Residues, Livestock & Plant Diseases, Noxious Weeds & Animals
If you intend growing crops on your land for sale or raising livestock for market, the
presence of chemical residue in the soil can destroy your business. Organochlorines
such as DDT were used extensively on farms (and all property) to control pests and the
residue can remain for decades in the ground and attach to plants and animals.
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. If you intend cropping a thorough investigation by an experienced
horticulturalist is recommended and Local Councils often have officers who can assist.
You may also want to get a soil test to establish firmly that there is no chemical residue
in the soil.
Noxious weeds and pests can also be a problem on rural land. A search sent to the LLS
(previously the Rural Lands Protection Board), can show any notifications or orders on
the property for these issues.
P a g e | 2
Survey
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.
Land Use
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). 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.
Infrastructure for your farm including 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.
Access
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 they 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.
Easements
The current plan of the land should be carefully considered for any “proposed” or
“intended” easements or rights of way. Easements not on the land at the time of
inspection, but noted on a plan as approved, may impact on your farming in the future.
Water Entitlements
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 all need the
appropriate approvals and details should be included in the contract for sale. Dams
should also be checked for compliance if required in the area in which you are buying.
P a g e | 3
Native Title
A search can be obtained to show whether there is a current native title claim on the
property and the extent of which this may affect your farming endeavours.
Taxation issues
If you are buying rural land on which to run a business you should discuss your
purchase of the land and the type of business you wish to have with a competent
accountant experienced in rural taxation who can advise you on GST and CGT
implications and tax issues.
Conclusion
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.
Legal professionals who are experienced in rural conveyancing can assist you in
properly investigating rural land for any risks to protect your financial investment.
If you or someone you know wants more information or needs help or advice, please
contact us on 02 9191 9293 or email mail@rnlegal.org