Land & Farms: Further growth in 2012 for West Country land market

Alex Rew of Stags looks at the performance of the land market in South West England in 2011, and looks forward to a strong year in 2012

2011 market – key features

The West Country market has become more confident through 2011. In 2010 the market for land was strong, but a number of farms, both residential and commercial, remained unsold, as the market rebased itself following changes in residential values.

• This inertia was shaken off early in 2011 and the majority of farms coming to the market have found buyers.

• Residential sales remain difficult but commercial farms, farms with a sizeable acreage, and bare land lots have been met with plenty of interest.

• Prices have been strong to very high where there are competing neighbours, giving an average price for land well up on last year.

2012 outlook – main market influences

• Continued restricted supply

• Competing interest from different purchaser types

• Continued restricted funding from banks

• The taxation benefits of owning farms/land, which include purchases for self-invested personal pensions

2012 outlook – what will happen to prices?

Prices have risen 20% in 2011 and we are predicting a continued rise but not at that fast pace, although there is likely to be a higher level of competition for larger commercial blocks of pasture and particularly arable ground.

How much land will come to the market in 2012?

The acreage sold by Stags in 2011 was up on both 2010 and 2009 and we would expect levels to remain fairly constant for 2012.

Easiest farm to sell in 2012?

A 200-plus acre family farm with productive arable ground.

Most challenging farm to sell in 2012?

A residential farm with high-value house and few buildings.

Sale highlight of the year

Fernham Farm, Brayford, on the edge of Exmoor in North Devon illustrated the underlying strength of the market for a quality farm. At 234 acres, it had a listed farmhouse, a three-bedroom cottage, farm buildings and some very productive farmland as well as amenity woodland and fishing. Multiple offers led to a sale in four weeks at well above the £2m guide.