AGRICULTURAL PROPERTY values are continuing to climb and farmers are coming back to the market, according to new figures from the Royal Institution of Chartered Surveyors.

The organisation‘s latest quarterly rural survey shows that the average value of deals struck on equipped farms (where houses and buildings accounted for less than half of the value) during the first three months of 2004 was £8262/ha (£3344/acre).

This was a rise of 12% on the same period last year.

Land agents attribute most of the rise to the lack of property available to satisfy rising demand.

Only 1200ha (2965 acres) of sales, totalling 34 farms, were reported to the survey, less than half the volume seen at the beginning of 2003.

Richard Brooks of property agent Lane Fox said: “Deciphering the detail and implications on each farm of the mid-term review is the standard scenario we meet every day.

“Until each farmer is clear where they stand, land sales will remain very few and far between.”

However, despite the uncertainty over CAP reform, farmers are moving back into the market for land, says the survey.

For the first time in recent years the share of farms being bought by residential buyers dropped, falling from 51% to 43% of sales.

A rise in farm profits on the back of improved commodity values has increased demand for commercial farms, while at the same time encouraging those thinking of selling to delay their decision.