Strong GB farmland market momentum carried over from 2020
During Q1 just under 15,000 acres of farmland were publicly marketed across Great Britain, continuing a five year run of low supply in Q1 according to analysis by Savills rural research.
Alex Lawson Savills head of farm and estate sales comments, “There was very little stock carried over from last year, which has meant that those who have brought land to the market early this year have been rewarded with strong sales as the buyers’ momentum from 2020 continues.”
Also there has been a continuing preference for privately marketing property. Last year private sales increased by 71% compared with 2019 as sellers quietly tested the market rather than opting for more public launches and were largely successful. This theme remained the case during Q1.
Consequently average values have showed marginal improvements and in some cases conservative guide prices have been well exceeded.
There are currently two particularly noteworthy types of buyer; the first is those looking for residential and amenity properties at all scales. This is borne out by the latest residential analysis from Savills which shows lifestyle choices continue to drive the more discretionary markets. The £2m+ country house market remains the star performer, with 2.9% growth quarterly and 8.8% annually.
The second is the environmental/conscientious buyer or investor looking for green assets. There is a strong belief that natural capital will become a profitable investment in the coming years which is also prompting investors chasing financial returns to get in now, ahead of the curve.
Alex adds, “Farmer buyers are always in the frame for a good quality commercial farm, blocks of land near to their existing base or opportunities for beneficial relocation. Now the ground is more accessible and crops are maturing we may well see a few more farms of this type on offer.
Despite this year’s shortage to date, Savills rural research predicts that annual supply will soon rise back up to the 10-year average as some farmers take advantage of the government’s lump sum exit scheme to retire and others find it difficult to adapt to the new post subsidy and Brexit environment.