Anyone looking to buy farmland and rural property will know it’s not always straightforward.
Anyone with an interest in farmland and rural property will know it’s not always straightforward when it comes to purchasing. It can be hard to find the right property in your desired location for the right price.
It is vital to call on the expertise of rural agents with expert local knowledge in this niche area of the property sector, who can help to guide you through the process.
Independently-owned Fenn Wright has been working for clients in Essex and Suffolk for 250 years, offering farms for sale, houses with land and rural properties. With 10 branches along the A12 corridor, the company prides itself on being the industry experts in this area with a reputation for providing the highest level of client care.
Fenn Wright Partner, David Ward answers six key questions regularly asked regarding asked regarding buying and selling farmland, how to find houses with land for sale in Essex and Suffolk and tells us about an impressive country home in Sudbury that has recently come onto the market.
How and where can I find farmland for sale with estate agents near me?
“Farms, estates and land are marketed by firms like Fenn Wright, used to dealing with many aspects of agricultural land such as valuations, planning and rent reviews for example. There are relatively few rural estate agents in Essex and Suffolk who can deal with such a wide variety of land; anything from a few acres to several thousand and including homes and outbuildings. We market properties on Rightmove and UK Land and Farms and are in regular contact with buyers looking in East Anglia. As much as anything else, it is about knowing your market and a high percentage of farms and land are actually transacted prior to hitting the open market.”
How much does farmland cost?
“There is a shortage of agricultural land so demand definitely outstrips supply. At the start of the recession, agricultural land value was about £3,000 an acre. At that time, with many other forms of investment looking less attractive, people started investing in land as a safe haven. At the height of the market it was going for £12,000-plus an acre. It has dropped back slightly and agricultural land now has a value of around £8,000 to £8,500 an acre on average. Some land can go for £10,000 an acre whilst some has a ceiling price of around £6,000 to £7,000 an acre, depending on location and demand. This is where the expertise of a local land agent with knowledge and experience of rural property for sale comes in. Land with a lake or a reservoir will command more money because irrigation means a wider range of crops can be grown. Grass is probably 25% to 30% down on the value of arable. It might go for £5,000 to £6,000 an acre.”
When is the best time to buy farmland?
“Traditionally spring is the time when land and rural properties tend to come to the market as a sale might complete in August, giving the seller time to harvest their crop so the buyer can go in straight after, ready to plant next year’s crop. Fenn Wright sell agricultural land throughout the year, so we would recommend anyone looking to buy to register with us to receive property alerts when something matches their search criteria.”
Can farmland be built on?
“Generally speaking, it used to be that you couldn’t build on farmland but planning policy has been turned on its head over the last couple of years. We have noticed a spike in people buying agricultural land on a speculative basis in the hope that it might eventually be considered for development. Building a single house is difficult outside permitted areas. Often, the only way you can get permission for a new house on farmland is if you can prove an agricultural need.”
Is farmland a good investment?
“In terms of return, stock market investors are usually hoping for 3-5% a year. Yields on agricultural land are 1%-1.5%, not a massive return though in line with bank accounts. Capital growth has levelled out but someone buying in 2018 might not sell until 2040 so you are looking at long-term gain. In the meantime, unlike residential property, it is 100% free from inheritance tax when passing on to the next generation. For some, the tax advantage is the main driver. You can also get capital gains tax relief when buying.”
How easy is it to buy cottages and houses with land and what kind of properties are currently available?
“Property with land for sale is rarer than the opportunity to buy land on its own. We are currently marketing a property called Princes Hall at Belchamp Walter, near Sudbury, for £3.65million. Comprising a five/six bedroom house, swimming pool and domestic outbuildings along with 255 acres of land, this is a wonderful opportunity to purchase a country house and agricultural land in the beautiful setting of the Stour Valley.
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