Ways in without buying land

Land ties up a lot of money in one thing. If you borrow to buy it, the repayments start straight away, good season or bad. That's why most new farmers start on someone else's land. Here are four common ways in.

Leasing

You rent a block for a set time and run it yourself. You pay rent, and usually some costs such as fences and water, depending on the lease. The NSW Government calls this an agricultural tenancy. It covers leases, licences, handshake deals and share farming. It strongly recommends putting the terms in writing.

The main risk is that rent is due whether it rains or not.

Share farming

The owner supplies the land and assets. The share farmer supplies labour and skills, and often machinery. You share the income and some of the costs. The NSW Government notes that if seasons or prices are poor, both sides earn less. You usually need less money up front than for a lease.

Agistment

Agistment means paying a landholder to graze your stock on their land. The NSW Young Farmer Business Program lists four common ways to charge it:

• dollars per head per week
• dollars per DSE per week (DSE means dry sheep equivalent, a measure of how much an animal eats)
• a percentage of weight gain
• a share of profit.

Agistment often needs the least money, because you only need stock and a cash buffer. The risk is that someone else is looking after your animals, and the landholder may end the deal when their own feed runs short.

Working on a farm first

You take a job as a farmhand or manager. You earn a wage and risk none of your own money. You can save for stock while you learn. Some people run a few head of their own on agistment at the same time. It's slower, but the lessons are cheaper.

Get it in writing

Whatever you choose, write down who pays for what, who does what, and how either side can end the deal. Have a solicitor check it before you sign. The Young Farmer Business Program toolkit has a sample agistment agreement and checklists.

Our guide to ways into farming covers each option, plus partnerships and family succession. If you're weighing up buying against leasing, try the buy or lease land calculator.