 Farmland values continued to rise in the first quarter of 2010 albeit at a rate slightly below inflation. Savills' research department points out that gold - a commodity that is much easier to trade than farmland - recorded some price correction during the same period both in current and real terms.
Looking ahead, Savills anticipates that growth will comfortably outstrip inflation by the end of the year with gold and farmland continuing to be good hedges against inflation. Farmland activity in the eastern counties accounted for just under half of all the acres marketed during the first quarter of the year. According to Savills recently published Q110 Market in Minutes 43% of all land publicly marketed was in the East, but despite this, values in this region like elsewhere continued to rise. Christopher Miles head of farm agency in the East comments: “Whilst values have risen for all land types, the gap between the best and the worst is widening. Good quality land in high demand areas is now fetching up to £8,000 per acre whilst poorer land in less popular locations is nearer £4,500 per acre." Savills Farmland Value Survey shows that the average rise in value for an acre of Grade 3 arable land during the first quarter was, at 1%, below that of inflation. Ian Bailey head of Savills rural research comments: “The fact that non-farmer buyers have, albeit tentatively, started to re-register their interest in farmland combined with a continuing low interest rate environment leads us to see no reason why farmland values will not gain momentum and we fully expect annual growth to be in line with our forecasts of around 5% to 6%” Cash buyers now represent over 60% of applicants registered with Savills to buy farmland. Most of these applicants are looking to purchase a property of up to 500 acres. |
Rural agency 
