21 Aug 2018
Signs of a post-lockdown farmland market bounce-back
After one of the quietest ever periods for farm sales, the market is bouncing back, partly driven by city buyers looking for rural isolation in the wake of lockdown.
Agents Strutt and Parker said only 9,300 hectares of English farmland was publicly marketed in the first six months of the year, half that seen during the same period in 2019.
Over the six months, only 79 English farms came to the market, compared to a 136 between January and June 2019.
Only two of those farms were larger than 400ha.
The lack of supply meant average prices rose by 3 per cent, with arable land averaging £23,230/ha.
Across Great Britain, 14,810 hectares were publicly marketed in the six months to the end of June, according to Savills.
The figure was down 52 per cent on 2019, while nearly half of all the listings in the six months were in June as lockdown was eased.
It calculated the average price for all farmland during the six months was £16,530/ha, up 0.5 per cent on the first six months of 2019.
The drop in farm listings was particularly marked in Scotland because it did not ease lockdown until early July.
Sellers were not active during lockdown, but potential buyers were.
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Registrations
Savills reported a doubling in buyer registrations during the six-month period compared to last year, with a 50 per cent increase in views of farms on its website.
That increase peaked at 70 per cent in June.
Andrew Pearce, head of Savills’s rural agency, said: “Amenity farmland is expected to be in higher demand now than previously forecast as urban dwellers act on lockdown-induced desires for more green space.”
The desire to escape the country is not the only driver in the farmland market.
The looming changes to support mean some farmers may be looking to sell-up, while others are looking to expand.
There is also an expectation that the ‘new public goods, for public money’ system will deliver opportunities.
“Our agents are also fielding more inquiries from buyers interested in tree planting and implementing other environmental measures, hoping to lock into new income streams which are developing from the management and enhancement of natural capital,” said Matthew Sudlow, estates and farms agency head at Strutt and Parker.
“Our conversations with potential buyers also point to many seeing land as a safe asset class in which to invest in times of uncertainty – a trend we have seen in the past.”
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