Private land sales ‘can attract premium prices’
MORE land has been publicly marketed in Suffolk to date this year than for any of the preceding three years over the same period, according to Savills Research.
By the year end, it is possible that the number of acres publicly marketed will exceed the 6,200 reached in 2011, Savills says.
But Will Hargreaves, of land agent Savills’ Ipswich office, said sometimes sellers achieve premium prices through a private sale. “Whilst selling in the open market can give the vendor comfort that the best price has been achieved, and this is our usual advice, it is sometimes the case that a private sale will generate a significant premium over an open market sale,” he said.
“Of course, the vendor will never know whether or not a higher price could have been achieved in the market place, but quite often the discreet nature of the transaction is worth more than any niggling doubt.”
Restricted competition was particularly attractive to investment buyers, who were often prepared to offer a premium price for the chance to keep a property out of the open market, he said. “There can be the added advantage for the seller that it may be easier to negotiate terms more favourable to the outgoing farmer than when dealing in the open market,” he explained.
Savills Research suggests that at the end of the second quarter of 2012, the demand for land purchases from Savills applicants across the country equated to a buying power of more than �5.7billion.
“To date in 2012, over 50% of the Suffolk land transactions handled by Savills Ipswich have taken place off market and it is clear from this that the average price paid per acre privately is higher than in the open market,” said Mr Hargreaves. “If a private buyer cannot be found, the land can subsequently be offered more widely, but, of course, the reverse is impossible.”