Keep up to date with the latest Stags news
George Alder, Partner and Head of Stags Farm Agency, examines the farms and land market in 2021 and offers his predictions and advice for 2022.
2021 saw rising farmland values as a result of shortage of supply and serious competition from all types of buyers. Stags Farm Agency’s farms and land database saw average land values increase across the South West from £8,249 per acre in 2020 to £9,061 per acre in 2021; a 10% increase.
George Alder, Partner of Stags and Head of the Farm Agency department, comments “2021 was one of the fastest and most dynamic markets for farms and land that we have seen for some time, fuelled by strong demand from farmers, investors and lifestyle buyers. Our Farm Agency team sold a total of £49,000,000 of farms and land across Devon, Cornwall, Somerset and Dorset.”
The confidence in the farms and land market has contributed to an increase in demand and price increases throughout the South West. The key drivers for demand and growth has been a combination of:
1. Improved commodity prices have seen farmers remaining confident, despite changing agricultural policy, and continuing to look for farms and land to expand.
2. An increase in investors buying land for decarbonising. Demand for farmland is broader than it has ever been before and the demand to meet climate objectives continues to grow.
3. Both companies and private individuals are seeking land for projects to meet biodiversity targets, either personal or policy led.
Looking forward, we have seen a strong start to the farms and land market in 2022, with viewing numbers and enquiries from new and existing buyers increasing each week. In January, we were 87% ahead of the same time last year for viewings. A good example of strong interest is Wheatcroft Farm, which launched to the market in mid-January with a guide price of £2,695,000. It attracted strong interest, with 85 viewings, and by mid-February a sale was agreed in excess of the guide price.
However, economic factors such as increasing interest rates and inflation on agricultural inputs could present long-term restraints on farmland price growth. So far, this seems to have had very little impact on the market, and there is good evidence of banks continuing to support farmers on purchases, but further inflationary pressures on input cost or interest rates rises could constrain growth.
To anyone considering the sale of farms and land, we recommend taking advantage of the current buoyant market, particularly whilst supply is still low. Please feel free to contact a member of the Farm Agency team to take advantage of our market knowledge and reputation as a leading South West Farm Agency.
Contact Stags Farm Agency on 01392 680059 or 01872 266728.
