Non-farmers snap up East Anglian farmland but demand outstrips supply
- Credit: Su Anderson
Non-farmers are continuing to snap up farmland in East Anglia this year, but supply remains tight, according to land agents.
Strutt & Parker says despite Brexit uncertainty, farms and estates marketed in the first three months of this year have met with ‘strong interest’ from potential buyers.
Head of estate and farm agency Michael Fiddes admitted Brexit uncertainties had led to a more cautious market sentiment among sellers with less land marketed in the first quarter than in the past two years, but commercial farmland and residential estates in the right location are in strong demand.
MORE – What are prospects for land values amid Brexit turmoil?“It has been a quiet start to the year in terms of the number of farms that have been launched on to the market, but tight supplies mean that demand remains strong for the right offering,” he said.
“We are seeing considerable interest in the 1,900 acres, spread over four farms and estates, that Strutt & Parker has brought to the market in England this quarter, particularly from buyers with rollover money to invest and private and institutional investors.”
Strutt’s Charles Wadsley said very few farms came on the market in East Anglia in the first quarter but interest had been positive for those that had, although farmland values continued to vary across the region.
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“While there’s a mix of local farmers, investors and residential buyers in the market, it is location that is determining the farms achieving the best values, for example, in areas where there is little historic supply,” he said.
“Many of these purchases are being funded with non-farming money, from external investors or existing farmers with development funds to spend. Larger farms are still proving popular and there is a noticeable shortage of commercial arable units of 750 to 1,000 acres.”
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Although more East Anglian farms were expected to come on the market this spring, supply would remain tight, he predicted. Mr Fiddes said a key trend was the level of interest from buyers funding their purchase with money generated from a source outside of farming. “These range from farmers who have rollover money after selling land for development, to high net worth individuals who want their own slice of the British countryside,” he said. “This means that location, rather than the quality of the land, remains the main driver of demand.”
According to Strutt & Parker’s Farmland database, the average price of arable land sold in the first quarter was £9,100/acre, compared to a 2018 average of £9,300/acre. However, prices ranged from £6,000/acre to close to £16,000/acre. Because numbers were small, figures needed to be treated with caution, said Strutt & Parker.