With greater demand than ever for woodlands across the South West, Stags Land Agent and Auctioneer Andrew Ranson offers his advice on buying and selling woodland with recent examples of woodland sales in Cornwall and along the Devon border.
Why invest in woodland?
There are two main types of woodland: commercial woodland, which is likely to appeal to foresters looking to manage and sell timber and amenity woodland, which is likely to appeal to amenity or recreational buyers whose main motivation is not driven by profit making.
Why buy commercial woodland?
Standing timber (trees not yet harvested) prices in the UK have soared by almost 30% in a year, according to Forestry Commission statistics published in 2018
The price of softwood saw logs also increasing by 20.8% and as timber prices are largely being driven by the booming wood processing industry (biomass and wood-chip boilers), it is harder to find firewood for log businesses
The UK Government is still missing its modest tree planting targets and as a result, the UK is the world's second largest net importer of timber after China
Tax-friendly investment reasons: woodlands are seen by many as a safe haven in these politically uncertain times
Commercial recreational uses, such as paintballing, creation of woodland lodges, outdoor training courses or woodland schools or classes
Why buy amenity woodland?
Environmental, wildlife and conservation interests
A desire to manage woodland, by creating a pond, wildlife haven or for firewood
Recreational interests and/or wanting a secluded peaceful spot to relax in
Factors that will affect woodland value:
Vehicular access to commercial woodland is essential for timber extraction. Stags recently sold Ogbear Wood, 14 acres at Gulworthy, which had a fairly steep and narrow access track from the road through a neighbour’s garden. Although close to Tavistock, it only sold for just over £3,500 per acre, after many buyers were put off by the access.
The size of commercial woodland must be sufficient to benefit from economies of scale for timber operations. Being small enough to be affordable to amenity buyers is crucial for these types of woods; once the price reaches over £60,000, the number of amenity buyers starts to thin. For example, we recently marketed a small farm near Launceston with a block of 30 acres of 15-year-old broadleaf, woodland, which we had to divide up to attract amenity buyers and ensure the client received the best price. Another example of this point is a small wood near St Ives that we sold last September at auction for £19,000 per acre.
Location is key; many buyers want privacy and seclusion without being too far from a town or decent road. In October we auctioned 4.3 acres of woodland near Bodmin with some pasture for just over £10,000 per acre. While this was in a peaceful spot with lovely rural views, it was popular with buyers because it was centrally located in Cornwall and only five minutes from the A30.
If you want privacy, the woodland must be large enough to ensure this; public rights of way, narrow dimensions and not having sporting rights included also dissuades purchasers.
Past management of woodland is important for maximising timber yields; in December we sold 24 acres of mainly mature Sitka Spruce at Lewannick, off a guide of £120,000. This had been regularly thinned and the final crop looked healthy and of good quality.
It is also important that amenity size parcels of woodland are useable. In context, a block of impenetrable conifers is far less appealing than well-spaced broadleaf woodland criss-crossed with paths. The 15 acres of woodland we recently sold near Boyton was very popular due to the number of private paths and rides the vendor had maintained throughout. Look out for a further 15 acres of this very accessible woodland, which is coming to the market this spring!
The variety of trees can be important to some; conifers are generally not so popular nor their timber so valuable as others
An attractive woodland also helps; we sold woodlands near Ladock, Carland Cross and Bissoe, near Truro, all of which had beautiful displays of bluebells in the marketing photos. They averaged 6.25 acres in size and achieved an average price of £73,000 each.
Stags is experienced at selling this slightly specialist type of property. Please contact Andrew Ranson for confidential advice whether you are buying or selling.
