Where will land prices go in 2013? We ask agents around the country to sum up the market in 2012 and to set out what will influence buyers, sellers and prices next year.
2012 market–- key features
The market this year has been slightly better than 2011, but still has some way to go to get back to normal.
We are selling mostly smaller farm units or bare land, with little coming through in the way of what you might call big farms – larger than 300 acres.
Demand is primarily coming from farmers looking to expand, while others dominant in the market are investors. Low interest rates and investment opportunities mean letting a decent farm on the open market will see a far better return than conventional investment methods at the present time.
Oddly enough, the market for large farms is not impressive – they sell well, but there are few coming on to the market. However, we have sold numerous smaller parcels of bare land for significant money, sometimes in excess of 80% of what we considered was the guide. It has certainly been a strange year.
|Sale highlight of the year (pictured above)|
|Land at Soulby, Crosby Garrett near Kirby Stephen – 27 acres sold for more than £9,000/acre, 76% more than the asking price. This was one of the largest ever prices achieved for such a sizeable acreage of land in this part of Cumbria.|
2013 outlook – main market influences
- CAP reform
- Bank rates/loan to value levels
- Non-farming investors
2013 outlook – what will happen to prices?
These may sneak even higher as demand continues to grow, but it is incredibly hard to say at present what that percentage might be. We would be looking to see a growth of between 5% and 10%, but at the end of the day, the influence from banks and ultimately the EU will dictate this.
How much land will come on the market in 2013?
CAP reform may have an influence on this, but at present I can only envisage similar levels to 2012.
Easiest farm to sell in 2013?
The easiest would be a Cumbrian dairy unit, well equipped, in excess of 400 acres – there is a lot of grass in the North West.
Most difficult farm to sell in 2013?
A small Cumbrian hill farm, in poor condition, with neighbours who are not looking at expanding their units.