A few weeks ago, we expressed the view that in the first half of 2008, agricultural land prices appear to have risen by an average of 20%-25%, although no official statistics are available yet. On 28 July the RICS produced figures showing a 24% rise. This follows a rise of about 30% in 2007, producing a total for the 18 month period of say 55%-60% to reflect the compound effect of the figures for the two periods.
It is worth dwelling on the point that this rise has taken place at a time when other sectors of the property market are in serious retreat, many housebuilders’ shares have lost 80-90% of their value and some high street banks are heading in the same direction.
Agricultural property has proved itself yet again as a safe haven - this time in a very extreme way.
After such a sustained rise the obvious question is ‘can it continue to rise?’ Our feeling is that the market is in the process of steadying for various reasons:
On the other hand substantial investment funds say they are poised to invest in land, and agricultural businesses generally, looking at the long-term threat of food shortages. These funds will be joining the queue for large commercial units, which have already been in short supply. Smaller blocks of land, which are so dependent on local buyers, are already showing signs of being unpredictable.
As a taste of Fisher German’s wide involvement in the national agricultural property market, activity in June/July 2008 has included the following properties.
Yorkshire - Ellercourt Farm, 250 acres, near Goole has been sold (subject to contract) through our newly acquired Newark Office (offered at a guide of £2,100,000).
Lincolnshire - Fisher German has recently acquired for a client Grange Farm, South Kyme, being about 850 acres and various residential properties. The guide was £6,500,000.
Staffordshire - Marlpit Farm, Marchington Woodlands – 262 acres – has been sold (subject to contract) at above the guide of £2m.
Worcestershire - in June Fisher German sold Red House Farm, 70 acres, by auction for Worcestershire County Council. Guide £700,000, fetched £910,000.
Leicestershire - The Osgathorpe Estate has recently been put on the market at a guide of £2,600,000.
Herefordshire - 126 acres in the Lugg valley being part planted with willows is available at £440,000.
Shropshire - 161 acres of arable land and woodland is available at £375,000.
Full details of these and other properties are available in the property section.
To discuss the sale of agricultural property, call your existing Fisher German contact or the nearest Fisher German Office.
Alternatively, contact Charles Haselwood on 01295 226289 or email charles.haselwood@fishergerman.co.uk
Fisher German also produce Agri-Facts which is a monthly round-up of news, prices and other farming matters. If you would like to receive regular copies, email james.goodson@fishergerman.co.uk
Click here to see the August 2008 edition of Agri-Facts
