Farm land values in the UK were down overall by 1.3% year on year in the second quarter of 2018 but there has been an increase in the volume for sale which has fuelled buyer appetite.
The latest analysis shows that bare arable farm land prices increased by 0.5% quarter on quarter to an average of £8,961, according to new data from national property consultancy Carter Jonas.
In addition, after a long winter and quiet first quarter, improved weather conditions throughout spring brought renewed momentum to farm land activity, which also provided an underlying strength to values.
At the same time, the firm says that evidence suggests that the impact of Brexit on sales within the agricultural sector has diminished in some cases. While some vendors, particularly of larger assets, continue to sell due to concerns about the lack of Government support and profitability, pragmatic buyers remain ambitious, and continue to unlock strategic opportunities in the market.
Indeed, it adds that while Secretary of State for Environment, Food and Rural Affairs Michael Gove’s stance on the Agriculture Bill has caused much consternation, the market is proving increasingly resilient to Brexit uncertainty, not least because now the consensus remains that minimal policy changes will ensue.
‘The increase in volume of transactions and values achieved is certainly promising for the farmland market and indicates the emergence of a certain stability after 18 months of flux. Indeed, we can feasibly anticipate that the brief period of declining land values has passed,’ said Andrew Fallows, head of rural agency at Carter Jonas.
‘It goes without saying that Brexit has exerted certain pressures on the agricultural sector since the Referendum two years’ ago, but this quarter’s figures indicate, for the first time, that landowners have resolved to plough forth regardless,’ he explained.
‘While some are still waiting for clarity from Michael Gove on the Agricultural Bill, it would appear that the farming community is starting to acclimatise to the protracted uncertainty and is ready to progress forward where possible,’ he added.
