The challenges thrown at farming in 2011-12 will slow the growth in average land values this year, says Strutt & Parker partner Mark McAndrew.
“I don’t think we’ll see a significant change in land values in the next two to three years, but you will still get £12,000 an acre for the right land,” he said at the firm’s annual rural land briefing.
“It’s never been more difficult to value arable land,” he said, highlighting the widening range of values for average arable land. “We can look at averages to see trends but in a small market the average itself can be misleading.”
A small number of high-quality arable farms that came on to the market late last year sold quickly and presented farm agents with a challenge, he said – all vendors now thought their land was worth more than £10,000/acre while buyers thought land was worth £7,000/acre.
“We have never had such a spread, even in percentage terms, in history,” said Mr McAndrew.
The difficult wet year of 2012 had brought land quality into focus, with premiums being paid for land that could cope with too much or too little rain. Drainage and irrigation had become the focus and soil type much more relevant.