East Anglia: Farmland values hit another new record, RICS reveals
FARMLAND prices in the East of England have again hit a new record as demand continues to race ahead of supply, according to the latest edition of a leading national survey.
The average price per acre in the region, which has more than doubled since the first half of 2007, increased to �6,844 during the first half of 2012, figures from the Royal Institution of Chartered Surveys (RICS) reveal.
It is the fourth consecutive edition of the twice-yearly survey to show a new record price in the region, with strong demand accompanied by a fall in the area of land up for sale.
Nationally, transaction levels fell to the lowest level since the start of 2006, with only 115 deals reported during the first six months of the year, down from 298 in the first half of 2011.
And with commodity prices climbing, surveyors in the region expect the trend in farmland values to continue, with a net balance of 54% predicting prices to rise over the next year – the highest since the second half of 2010.
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RICS spokeswoman Sue Steer said: “Farmland prices in the East of England hit a record high yet again at the start of this year and very few transactions went through across the country. The main reason was that the amount of farmland coming on to the market simply couldn’t keep up with demand from commercial farmers who are looking to expand.
“With commodity prices now having risen for some time, and the situation looking unlikely to change for the foreseeable future, understandably, chartered surveyors expect price rises to continue their upward trend across the region over the coming 12 months.”
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Giles Allen of Strutt & Parker in Ipswich said: “Demand and lack of supply are allied to strong commodity prices. Land owners are reluctant to sell as they are making profit whilst demand continues to rise.”
And Benjamin Taylor of Bidwell in Cambridge added: “There remains limited stock in terms of land availability and a number of buyers have been left frustrated.
“We have been involved in several recent commercial land sales and purchases that went well in excess of the guide price and for each there were a number of under-bidders who are doubtless still keen to acquire.
“The signs are that it will be a relatively quiet autumn, and the few farms of sufficient quality and scale that do come forward should sell well. It will be interesting to see the impact of a disappointing harvest in some parts of the region, although our view is that strong prices will sustain into 2013.”