Arable land values hit an all-time high
The price of arable land has reached a record high, with the first half of 2023 seeing the average value rising to £11,100 per acre, according to Strutt & Parker’s Farmland Database.
It is the first time that arable land has ever exceeded £11,000 per acre. The previous market peak was in 2015.
The database, which records the details of all farms, estates and blocks of publicly marketed farmland over 100 acres in size, shows that the average value of arable land rose by 2% during the first six months of the year, on top of a steep 15% rise in 2022. However, the average value of pasture land dropped back on 2022 levels.
The price of arable land has reached a record high, with the first half of 2023 seeing the average value rising to £11,100 per acre, according to Strutt & Parker’s Farmland Database.
It is the first time that arable land has ever exceeded £11,000 per acre. The previous market peak was in 2015.
The database, which records the details of all farms, estates and blocks of publicly marketed farmland over 100 acres in size, shows that the average value of arable land rose by 2% during the first six months of the year, on top of a steep 15% rise in 2022. However, the average value of pasture land dropped back on 2022 levels.
Matthew Sudlow, Strutt & Parker’s head of estates and farm agency, said: “Record prices reflect the strong demand we have seen for farmland from a wide range of buyers, coupled with a shortage in farms and estates for sale. However, in recent weeks we have noticed that rising interest rates and squeezed farm profitability are making farmer buyers more cautious where they are reliant on the proceeds of their farming activities, rather than rollover money. As this trend is gradually reflected in our data, we may see some downward pressure on average values, although we are not expecting any dramatic changes.”
Supply is still tight for all land. The acreage of farmland put on the open market during the first six months of 2023 is one of the smallest amounts of the past 20 years and is 18% below the five-year average.
While the firm said the total amount of available land, whether public or private, remains very low in historical terms, it added that there were early indications that the volume of land coming forward in Q3 could well be higher.
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