The latest RICS/RAU Rural Land Market Survey for the second half of 2017 shows availability of farmland continuing to decline. The principle driver for this is political uncertainty, with the Brexit process being held largely responsible.
Demand for farmland has also eased back from the peak of the market in 2015, for much the same reasons.
“Against this fall in supply, demand now appears to be starting to stabilise, which can only be good news for sellers and buyers” says Richard Greasby, head of Butler Sherborn’s Rural department. He goes on to say that “the market is however polarised, which makes commentating on it in general terms tricky”. The best demand and prices are for higher quality land in good locations, whereas lower grade farmland, where access or conditions are more challenging, seeing much lower demand and prices.
“Within the Cotswolds we find that our local market follows these wider national and regional patterns” says Richard, “particularly for blocks of bare commercial farmland. “However, the market is very localised and can be especially distorted if there are buyers in the locality with Capital Gains Tax roll over money to spend. Smaller blocks of amenity land continue to sell quite strongly with demand being very localised. Given that the Cotswolds continues to be a popular place to live, any farm with a good residential element still attracts interest, so long as it is priced sensibly.
Regardless of the current supply trends, farmland is an unusual resource in that the reasons for owning it are extremely varied. The farm land may be held for food production, making a living as an amenity, for sporting, equestrian, for conservation reasons or purely as a financial investment with the tax benefits that brings.
“Once the outlook post Brexit is clearer and we get some political and economic stability, then we expect further stabilisation in the market, albeit that we cannot yet predict where that level will be” says Richard.
In the meantime, Butler Sherborn are marketing Manor Farm, Hornton which is a mainly arable farm of 448 acres, located in two principle blocks with planning permission for the creation of a new country house. The farm is being offered for sale as a whole at £5.30 million, but also in up to five lots.
Further details can be obtained from Ben Way at our Stow on the Wold office
Tel: 01451 830731