Buyers and sellers seeking certainty may now feel more confident about making long-term decisions in the land market following the recent decisive general election, say agents.
Throughout 2019, just 10,788 acres were launched in the east of England, according to Savills, down 67% on the previous year, and few large farms became available.
With demand staying high and prices remaining firm, 2020 could see more activity, though much hangs on the realities of Brexit and the UK’s transition period.
See also: Land in your area: East Midlands
Smaller units filling market
The supply of land coming to the east of England market tightened during 2019. In contrast to 2018, there were no farms of more than 1,000 acres publicly launched. The year’s sales were principally parcels of bare land or smaller farms, although some had significant residential elements.
The market remains active, with a relatively stable level of demand across much of the region, so farms and land that have come forward are selling – some well.
Almost all of the farms that we marketed during 2019 are now under offer or have exchanged, some of them after competitive bidding.
Location and accessibility, rather than the quality of the land, are the key factors for achieving the best prices across the region.
Overall, the spread in values achieved remains wide, ranging from £6,000-£12,000/acre. The majority of Grade 3 cereal land typically falls into the £8,000-£10,000/acre bracket.
Giles Allen, senior associate director, Strutt & Parker, East of England
Prices to remain firm
Investors love certainty and we finally have a little more of that – at least UK political, if not European – and from a party that will not be seeking to overhaul the dynamics of the marketplace to any great degree.
There is pent-up demand from buyers out there, so the clear general election outcome may get those who were perhaps wavering over the past 12 months to come off the fence and act – just how many remains to be seen.
But fortune favours the brave and there are plenty of reasons now to suggest that land prices will remain firm for 2020.
Those seeking to restructure, retire, reduce debt, or transfer wealth may well be advised to consider the implications on deferring that move and instead to take advantage of a land market that was remarkably resilient in 2019.
As long as the taxation system remains largely unchanged, it will continue to underpin what was a chronically undersupplied market this year.
Brexit and what it truly means still hangs over us and the Agriculture Bill will need to be reintroduced, but there are a number of sound reasons to think 2020 could be a very sensible time to carefully consider the options.
James Brooke, partner, Bidwells, Cambridge and Norwich
What sold well?
A versatile 300-acre block of land at Hall Farm, Bridgham, on the Norfolk/Suffolk border, was launched by Strutt & Parker and Peter Crichton in 2019 and sold as a whole in excess of its £2.2m guide price.
The mix of arable land and permanent pasture proved popular due to a significant abstraction licence, allowing a wide variety of crops to be grown.
What’s on the market?
Grapnells Farm, near Rochford, Essex, is available through Strutt & Parker as a whole or in two lots, guided at £3.075m.
The 256-acre arable unit includes a five-bedroom farmhouse, cottage, offices and a substantial range of buildings.