Small landholdings in Scotland: legislation review

Housing

Issues Raised

72. Under small landholder legislation, most small landholdings are bare land lets where many of the buildings, including the dwelling houses, have been erected by the small landholder or their predecessor. Funding for such an investment usually came by way of grant via the then Board of Agriculture for Scotland.

73. This raises a number of issues:

• Small landholders can sometimes perceive that they own the houses that they or their predecessors have had built, but that they do not own the land under the buildings. However, the general legal position is that the owner of land owns the buildings on it, with the small landholder generally entitled to compensation on waygo, with compensation for permanent improvements governed by the provisions of the Crofters Holding (Scotland) Act 1886. ^[56] It may be that in individual circumstances, small landholders have ownership of their home. For instance, anecdotal evidence suggests that some have purchased the land under their buildings, although this figure remains low. If small landholders are in doubt as to their particular circumstances they are encouraged to seek independent legal advice.
• Non-ownership of the land under the buildings might prevent access to funding from lending authorities who do not recognise the buildings as collateral.
• The insecurity of not owning their homes means that many small landholders are concerned over the risk of homelessness or the stress of having to purchase another property late in life. It has been reported that this contributes to a sense of lack of security in their general position, although it should be borne in mind that small landholders have security of tenure (see Security of Tenure section ).

Legislation

74. There is no provision in the Small Landholders (Scotland) Acts 1886 to 1931 for the purchasing of the site of the dwelling houses. There is very little in the legislation on housing in general: the 1911 Act (section 9) provided that the then Board for Agriculture in Scotland may provide loans for the rebuilding or improvement of dwelling houses. The construction of a dwelling house is also listed as an improvement for which compensation can be claimed by the small landholder at waygo. ^[57] By way of comparison, crofters can purchase their dwelling-house. ^[58]

75. The small landholder needs the landlord's written consent to sublet or erect an additional dwelling house on the holding (other than substituting the one that is already there). ^[59] On the matter of building, this is comparable to crofting legislation, however, crofters may now sub-let with the permission of the Crofting Commission. ^[60]

76. Perhaps a wider view needs to be taken when it comes to the purchase of the whole small landholding.

77. Contrast to crofting where there is a provision for crofters to take land out of crofting, termed 'decrofting'. When land is decrofted, the crofter must then purchase the land, otherwise it reverts back to croft land.

78. A crofter has the absolute right to decroft and purchase the land necessary for one croft house and garden (Statutory Croft House Site and Garden Ground ( CHSGG). Crofters can choose to build upon the croft but not decroft, in which case the croft and house remain as one unit, which can then be assigned to another person.

79. Small landholdings legislation also provides that the landholder is responsible for the maintenance of all buildings on the holding regardless of who was responsible for building them. ^[61] In theory, breach of this condition of security of tenure may result in the landholders removal from the holding. ^[62] Legal provisions in crofting tenure are broadly the same. ^[63]

80. In certain cases a small landholder may qualify for grants or loans under the provisions on assistance for housing purposes in the Housing (Scotland) Act 2006. ^[64] However, availability of funding may vary amongst the different local authorities, dependent on competing priorities and resources.

Discussion

81. Notwithstanding the lack of statutory provisions, in the past some parties have reached agreement whereby the landholder has purchased the solum or land under their dwelling house. Consideration could be given to establishing a right for small landholders to purchase the solum and curtilage ^[65] in order that they own their dwelling-house.

82. Any introduction of a right to buy would need to be balanced with what may be considered to be a possible barrier to new entrants or assignee, who would have to take on a holding where there is no existing farmhouse. These individuals would have to face the potential cost of building a house, on top of any business investment costs. As a further barrier to new entrants, offering a potential right to buy may encourage small landholders to remain on the holding, when they might normally retire. Any right to buy proposal would require careful consideration, including removal of the property from small landholding tenure and compensation for landlords.