Farmland values have risen by over 25% so this year with further growth of 11% predicted for the next 12 months, says Knight Frank.

The property firm said the average value of all types of farmland had increased 27% from £2988/acre to £3805/acre during the first six months of the year.

This was the fastest rate of growth since 1977, it added.

Supply failing to match demand

Clive Hopkins, head of farms and estates, said supply – up 8% – was failing to match demand, which had gone up 14%.

Demand from cash-rich lifestyle buyers had risen 25% in volume terms on the year, but over 50% in terms of value.

Their influence was likely to increase as they became even richer, he said.

UK farmers heading abroad

International buyers, especially those from Ireland and  Denmark, continued to support the market with 15% of purchasers from overseas, he added.

But in a growing trend, the number of UK farmers heading abroad was also increasing, said Mr Hopkins.

He reckoned about 1 in 15 of farms sales were due to emigration, often by younger farmers heading to Australia, New Zealand and Canada