RICS Rural Market Survey
H1 2011
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Farmers bid up land prices to record high; surveyors expect this to continue
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Farmland prices reach all-time highs, but pace of growth moderates due to rising availability
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Commercial farmers remain keen to expand production but activity levels are more subdued in the residential sector
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Surveyors expect commercial farmland prices to continue rising strongly, but expect prices of residential farmland to stabilise
However, with farmland availability increasing for the first time since H1 2008, there are signs that price momentum is beginning to slow. Over the next twelve months, surveyors expect the recent trend in farmland prices to continue; stronger growth in the commercial farmland market but a flatter trend in the residential sector.
The survey’s ‘transaction’ based measure of farmland (which includes a residential component) increased by 6% during H1 to £7,479 per acre. The ‘opinion’ based measure (which is a hypothetical estimate by surveyors of pure bare land values) increased by 5% to £6,115 per acre. Both price levels are historic highs, but the growth rates mark a slowdown compared to H2 2010.
