It means that the value of England’s country estates are now almost back at their 2007 peak, having originally fallen by 15% during the downturn of 2008, according to the latest Savills Estates Index.
The firm has potential buyers from around the world looking for suitable country estates to buy as investors recognise their value.
‘Since the downturn, estate values have been protected by the substantial rise in farmland values, which have increased year on year since 2007 to record five year growth of nearly 80%,’ said Crispin Holborow, head of Savills Country Department.
‘There is now clear evidence of the beginnings of a recovery in the other elements of value. This includes marriage value or the premium attached to the assets when all in one parcel, which rose by 4% last year and is perhaps the clearest indicator of an improving sentiment in the estates sector,’ he added.
He pointed out that over the past five years land has become an increasingly important factor.‘Across our sample of 20 estates in England, the proportion of value attributed to land continues to rise and now accounts for 39% compared with 21% seven years ago. As a result, the larger estates with more acres have performed most strongly,’ said Holborow.
In the past five years Savills estimates that there have been 61 estate sales each worth at least £5 million with an acreage of more than 500 acres. The aggregate value of these estates was £895 million.
Savills has £6 billion of buyers’ funds registered looking to invest in land, farms and estates with a large proportion of these funds being cash. The biggest issue for these buyers is currently a lack of suitable properties available to buy.
‘Analysis of the viewings from the last three estate sales transacted by Savills indicates that interest came from eight different countries around the world. Undoubtedly, an increasing number of individuals now recognise the financial advantages, particularly in terms of taxation, as well as the amenity benefits of land ownership,’ said Holborow.
‘This combined with the improving performance of the other component parts must be good news for estates in the medium to long term,’ he added.
