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    Farm Contractor & Large Scale Farmer
    Markets & Policy

    Farms selling faster in response to strong demand

    Matthew TiltBy Matthew TiltJuly 15, 20223 Mins Read
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    Aerial,Photography,Of,Green,Fields,In,English,Countryside

    New research from Strutt & Parker shows that farmland is selling more quickly than it has over the past five years, with demand outstripping supply.

    Analysis of the firm’s Farmland Database, which records all farms, estates and blocks of publically marketed farmland over 100 acres, shows that nearly half of the farms marketed this year are already either under offer or have been exchanged.

    Tight supply and strong demand have pushed the average value of arable land in England up by 2% to £9,600 per acre – the highest it has been since 2015. Pasture land has also risen, this time by 6% to £7,900 per acre.

    “We haven’t seen a farmland market like this for some time,” said Matthew Sudlow, head of Estates & Farm Agency for Strutt & Parker. “Competitive bidding and best-and-final offers are becoming common for top-quality properties in desirable locations. For example, a 500-acre farm on the market recently for £7.25m attracted viewings from 17 interested parties and went under offer, after just five weeks, for more than its guide price, following a call for best-and-final offers.”

    Supply is reportedly growing, with 43,400 acres marketed in the first half of 2022 – 12% more than in 2021 and 11% above the five-year average. However, much of this rise is attributed to a small number of significant sales in the Eastern counties, rather than a rise in the total number of farms marketed.

    There are more farms than usual available in the north of England, although the majority of farms for sale are in southern England where there are slightly less available than on average. Currently, there are 121 farms publicly available, the same as the five-year average.

    “Even if we consider the number of farms available privately, the volume of land available is, in most locations, still not high enough to meet demand,” said Mr Sudlow. “Demand remains robust because of the broad spectrum of buyer types wanting their own slice of the countryside – from farmers with rollover money, to lifestyle buyers and green investors looking to invest in natural capital.”

    According to Strutt & Parker, there are no signs of demand dropping. In times of economic uncertainty, land is seen as a safe haven for wealth and a hedge against inflation. Farmland may only deliver modest annual returns but it remains an attractive investment vehicle, being a tangible asset that can be enjoyed and offering tax benefits and the potential for capital appreciation.

    Mr Sudlow concluded by saying it is anticipated that supply will continue to steadily increase. “We are certainly having a growing number of conversations with farmers with no successor who are currently considering a retirement sale. For those who are already considering a sale, it makes sense to take advantage of the strength of the market, particularly given the backdrop of rising input costs and volatile commodity prices, and the availability of the lump-sum scheme. However, while we expect total supply in 2022 to be up on 2021 levels, in historic terms volumes are likely to remain tight for the rest of the year.”

    East MidlandsEast of EnglandNorth WestNorth EastSouth EastSouth WestWest MidlandsYorkshire and HumberEngland
    Q1 & Q2 20187,80011,2003,2001,2006,0005,6004,1003,50042,700
    Q1 & Q2 20193,9005,6006,7003,0004,40012,7003,5005,40045,300
    Q1 & Q2 20202,8005,7006002,6003,4007,5002,0001,00025,500
    Q1 & Q2 20215,2005,9001,7009,1005,0006,2001,9004,00038,900
    Q1 & Q2 20221,90014,5003,4005,3005,9003,6002,2006,50043,400
    Five-year average4,3208,5803,1204,2404,9407,1202,7404,08039,160
    % difference from average-56%69%9%25%19%-49%-20%59%11%
    Figure 1 Amount of farmland publicly marketed in England (acres)
    NB Figures are for whole years unless otherwise stated and are rounded to the nearest 100 acres. Privately marketed farmland has been excluded due to the difficulty of collecting comprehensive information.
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    Matthew Tilt
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    Machinery editor for Farm Contractor & Large Scale Farmer. Matt has worked as an agricultural machinery journalist for five years, following time spent in his family’s Worcestershire contracting business. When he’s not driving or writing about the latest farm equipment, he can be found in his local cinema, or with his headphones in, reading a good book.

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