Rural property agents Savills say land values could slow as market sees more sales
The recent rise in farmland values could be set to slow, as more farmers opt to sell off their land in response to government policies, a new report has claimed.
Property and land experts Savills' report said 2023 saw a 鈥榮tep change' in agricultural land provision as availability rose by a fifth. In total 157,200 acres were marketed during the past 12 months - 15 per cent more than across a previous five-year average.
In England sales on the open market reached 115,500 acres - rising above 100,000 for the first time since 2018. While in Wales, more land traded here in 2023 (15,700 acres) than in any year since 2000 (17,600 acres), as the market exceeded its five-year average by more than 40 per cent and prices rose by 23 per cent.
According to Savills, the Welsh Government's Sustainable Farming Scheme (SFS) could keep prices high as the policy provides for 鈥榥ature-based incomes' as well as traditional ones.
In Scotland, the picture remained in line with that of the past couple of years, as land continues to be in short supply. Savills said it remained unlikely values would reach the heady heights of 2021, when prices soared by 31 per cent as afforestation targets incentivised buyers.
Kelly Hewson-Fisher head of rural research at Savills said the agricultural transition and Government policy had had a clear impact on land transactions and that a coming General Election gave farmers the opportunity to review the 鈥榦ptions and opportunities' for their land.
Read also: Save land for food and nature, says CPRE
"Profitability remains key which drives sustainability, re-investment and economic growth," said Ms Hewson-Fisher.听"New investors coming into the market will also be a driver for land use.听There are a number of government set targets for the environment such as 鈥�30x30' and net zero emissions by 2050 of which, land remains a solution provider.听Whilst government is committed to food security with Steve Reed (Labour) claiming food security is national security, [but] there are听currently听no policies to underpin this commitment.听
"We do need to understand and have confidence in, how options can be integrated to provide for the wide range of needs from our land," she added.
However, John Coleman, head of 51AV视频Agency at land and property company GSC Grays said potential changes in government could provide the impetus for sales as farmers seek to avoid negative tax changes, such as Capital Gains Tax (CGT) and Business Asset Disposal Relief (BADR.
Mr Coleman said: "Whoever gets in at the next election will wish to review both CGT and BADR. Change is likely to come and if it does, it will not be positive and could affect the land market so selling now is the message. It is the opportune time."
