Region sees less farmland come to market but continues to buck the national trend
The East of England accounted for 15 per cent of the farmland put up for sale in the UK during the first three months of this year, according to research from Savills.
A total of 1,120 acres of farmland were publicly marketed in the region between January and March 2019 – compared to 1,210 acres for the same period last year, a drop of eight per cent.
However this figure is up on Great Britain as a whole, which saw a decrease of 28 per cent when compared to the same period in 2018, with 10,390 acres publicly marketed.
Savills’ quarterly farmland value figures also show that the average value of prime arable land in the Eastern Counties remained relatively stable, falling 0.9 per cent to £8,690 per acre in the first quarter of the year.
Adrian Wilson, from the rural team at Savills Cambridge, said that despite challenging market conditions there was still a demand for high quality farming businesses – with more land expected to come onto the market later in the year following greater clarity over Brexit.
“The market in the first quarter of any year tends to be relatively small as most sellers prefer to wait and launch their property in the spring so the figures are not wholly unexpected,” he said. “But it does appear that current political and economic uncertainty has slightly muted the supply of land coming onto the market.
“Undoubtedly there are some significant challenges ahead for farming businesses but until the future farming policy is ratified it is difficult to forecast how the farmland market might be affected.
“It is, however very clear that despite wider concerns there is still appetite for well diversified or high quality commercial farming businesses and the best amenity estates.
“Premiums are likely to be paid for top quality properties, where demand is strong from forward looking farming businesses that are looking to expand existing operations and roll-over investors seeking new opportunities. Meanwhile, non-farming buyers are looking to invest away from riskier asset classes and there is a rise in interest for amenity property.”
Nationally, the supply of land in the first quarter of this year was 28 per cent less than in the first quarter of 2018 and 40 per cent lower than the average since 2000 – the lowest acreage recorded since Savills’ analysis began in 1995.
Wilson added: “With very little activity and consequently little transactional evidence, it is no surprise that our farmland value survey has recorded very little movement in average values since the end of last year.
“Our research shows that depending on location, average values across Great Britain have remained stable at around £7,500 to £8,800 per acre for prime arable and £5,500 to £7,000 per acre for average quality grassland.
“We are predicting that these average values will remain relatively stable throughout the year as there are plenty of buyers registered.”