More farmland has been publicly marketed in England in 2018 than at any point in the past 10 years, reports estate agent Strutt & Parker. Its Farmland Database shows that 50,000 acres has hit the market in the past three months, taking the total amount launched for sale so far in 2018 to 96,600 acres, compared to 78,200 acres in 2017 and 87,800 acres in 2016.
National property consultancy Carter Jonas estimates that bare arable farmland values registered a marginal increase of 0.2% between quarters two and three. The company also notes that average year-on-year land values showed an increase of 0.2% from Q3 2017 to Q3 2018, which it ascribes to consistency in supply and demand ratios.
Michael Fiddes, head of estates and farm agency at Strutt & Parker, says: “We’ve gone from very tight supplies earlier in the year to a position where we’ve seen more land put on the open market than at any point in a decade. A significant chunk of the land which came forward in Q3 is accounted for by sales by a handful of larger landowners: seven farms marketed in Q3 account for 28,000 acres alone.
“However, even ignoring these, supplies do look to have increased. There have been more farms for sale in the East of England, including six larger than 1,000 acres (compared with two in 2017). There has also been a big increase in the South West, with 46 farms marketed, the most since 2010, and 8,000 acres in the North East compared with 2,100 in 2017.”
“Whilst it would be easy to jump to conclusions as to why there has been an increase in the supply of land in the market, the underlying factors which have always led to the sales (often known as the three Ds – death, debt and divorce) are still as relevant as ever,” advises Mr Fiddes. “That said, the prospect of Brexit does seem to have acted as a prompt for some landowners to reflect on their long-term future in land ownership.”
Mr Fiddes comments that following the publication of the Agriculture Bill, questions are being asked about its possible impact on long-term values. “In our view, there are still so many uncertainties it is too soon to come to any firm conclusion.
Carter Jonas believes that prices will remain steady for the rest of the year, and buyer confidence will become more important. Its head of rural agency Andrew Fallows comments: “The summer heatwave and unprecedented weather conditions exerted certain pressures on the farming community, particularly livestock and vegetable farmers. However, the harvest has proved relatively straightforward and yields have been solid, although that has made buyers ever more conscious of the quality of land, and in particular soil, that they are purchasing.
“Looking ahead, we expect the market to continue to polarise between quality units in areas of demand and poorer units in more remote locations. The Agricultural Bill will be watched carefully, and in particular the clauses around emerging Environmental Land Management Scheme (ELMS) and the proposals to de-link payments that may provide a retirement fund.”