Farmland prices hit a record high at the end of last year as commercial farmers chased limited supplies coming on to the market, a survey has revealed.


The RICS Rural Land Market survey found the average price of bare land rose 6% in the last six months of 2010 to £14,500/ha (£5868/acre), while land with a residential element increased by a similar amount to just under £17,000/ha (£6880/acre).

The East Midlands and North West recorded the biggest increases with prices up 17% and 12% respectively, while the cheapest land was in Scotland where average prices fell 8% to £9100/ha (£3683/acre).

RICS spokesperson Sue Steer said prices had been pushed up by strong demand from commercial farmers looking to expand production to capitalise on higher commodity prices.

“This, combined with lack of supply of good quality land can only lead to even higher prices over the next 12 months. In comparison, the residential farmland market remains relatively subdued, reflecting the broader national housing picture.”

RICS said the availability of both commercial and residential farmland had been falling for two-and-a-half years.

Land prices H2 2010 (£/ha)

Region

Arable

Pasture

Average

Eastern

16,062

11,120

13,591

East Midlands

14,827

12,603

13,715

North-East

14,209

9,946

12,078

North-West

17,298

17,298

17,298

Scotland

11,738

6,548

9,143

South-East

14,827

12,356

13,592

South-West

14,827

12,973

13900

Wales

17,298

15,444

16,371

West Midlands

16,062

13,591

14,827

Yorkshire & Humberside

15,753

11,120

13,437

Source: RICS