Over the last six months of 2014, farmland values rose by 2.5%. This increase masked a growing and more distinct regional variation, with values in the South and East of England reaching values of circa £14,000, whereas the South West saw values of £9,000 per acre. Key factors in attaining prime values were location, type and quality, alongside the strength of the local market.
2014 saw the supply of land remaining increasingly limited, with a total of nearly 120,000 acres being openly marketed across the UK, a 15% decline from its 2013 level. As a direct consequence of this restricted supply of openly marketed land, the volume of off market sales grew substantially during 2014 as clients considered seeking out private deals in order to gain publicity within the sector. This trend is anticipated to continue into 2015 and will help to sustain the continued capital value growth that is forecast for the next 12 months.
During 2014 demand became more and more localised across the farmland market, with lot sizes over 1,000 acres proving most enticing.
“The halo effect surrounding London remained significant and is expected to build momentum during 2015 as the capital continues to thrive in performance and remuneration levels are set to outpace inflation,” Andrew Fallows, partner in Carter Jonas’ national farms and estates team, said. “The halo effect is particularly prevalent in the country house market with a maximum of 50 acres, although holdings with larger parcels of land continue to benefit, albeit to a lesser extent.”
He added: “The inevitability of increasing interest rates, currently predicted to occur in the second half of 2015, is also expected to impact the general tone of the land market and our forecasts predict that average land values will increase 3% during 2015.”
.jpeg)
.jpg)
Comments