Farm Ireland
Independent.ie

Saturday 20 January 2018

British farmland prices average £8,300/ac up to September

Jim O'Brien

Jim O'Brien

The average price of farmland in Britain reached £8,300/ac (€9,700) in the first nine months of 2013, a new survey has revealed.

The survey, undertaken by Savills UK, indicates that the average value of farmland continued to rise across Britain during the third quarter of 2013.

Prime arable land in the east of the country achieved the highest average value at just over £9,000/ac (€10,586/ac).

The estate agency has predicted an 8.8pc rise overall for farmland prices in 2103, compared to 2012. Prime arable land is expected to outperform all other land types, given that it had already grown by 8.5pc by the end of September.

The agency also reported a widening gap between the prices paid for the best and poorest farmland. Price growth during quarter three was concentrated in the eastern and northern regions.

According to the authors of the survey, average values conceal regional variations, with value being closely linked to location, land quality and type, as well as the residential weighting of the farm. The survey points to a growing price differential between poor grassland and prime arable land values.

During quarter three, the strongest average prime arable price growth was in the eastern counties (4.6pc), Scotland (3.3pc) and the north of England (3.1pc), south east (1.9pc) and east midlands (1.3pc).

Land prices have remained stagnant in Wales since December 2012.

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The west midlands, the south west and Wales saw no change in the price of prime arable land during the last three months.

Very little land market activity was recorded in those regions either.

The west midlands and the south west had growth rates of 4.6pc and 2pc respectively since the start of the year but the steepest rise was in the east, where price rose by 12.1pc.

SUPPLY

A total of 128,309ac of farmland were publicly marketed across Britain in January-September 2013, an increase of 5pc on the same period in 2012.

However farmland supply across Britain continues to be historically low and the 2013 level so far is lower than the average relative supply for the last three, five and 10 years.

In Scotland, the total volume of farmland publicly marketed so far this year is the highest on record since 2003 but supply dropped sharply in the east of England, where just 9,640ac of land was publicly marketed. This is the lowest figure recorded for the region since 1995.

The survey refers to anecdotal evidence that private sales of land could account for as much as 30pc of the total market so far in 2013.

Looking ahead, Savills predicted that the improved weather conditions of 2013 and better-than-expected harvest yields would reduce financial pressures on some farmers and could reduce the number of debt-related sales.

The estate agents said a growth of 8.8pc in the average price of a British acre is realistic, driven by a strong market for quality commercial arable land and the best dairy farms.

Irish Independent