Looking for farms for sale? Don’t leave it too late!

The current market climate is showing that owners of farms, farmland and estates are more reluctant than they’ve been for a long time to place their farms and associated land to the market place. This has meant that there have been fewer farms for sale and less acreage for sale within the UK in recent times. This reduction in availability has created a highly competitive marketplace and highlighted the importance for buyers of appointing a farm search agent. A farm search agent is essential to buyers if they want to be the first to hear of information about privately available and pre market properties, and stay ahead of the competition in gaining access to these unique opportunities.

When comparing statistics between 2006 to 2007 experts might claim that in England there has only been a slight decrease in farms for sale and acreage available, however, on closer inspection of the statistics anomalies are evident which have distorted the figures. These anomalies are particularly evident in the North of England which has seen a small number of large estates coming available. If these estates were excluded then the true decrease would suggest a significant fall in acreage for sale of 35 per cent from last year. The decrease in farm land for sale in recent years  has been confirmed by Savills Private Finance who have reported that the amount of land coming onto the public market each year was down from about 600,000 acres per year in the 1960`s to 125,000 acres a year today.

Research by Strutt & Parker shows that “the reason why less farms and land are coming to the market included the fact that farmers and landowners were still absorbing the changes bought about by the single farm payment, an inclination on the part of those wishing to stop farming to contract out the business rather than sell up, and the general improvement in farm profitability”.

But as well as the decrease in supply of farms for sale and land coming to the market, the demand for farm land is increasing as investors are seeing it as a credible alternative to stocks and shares. St James Place Wealth management records that the price of corn is rising and has hit a record high of $6.27 a bushel, a 75 per cent increase in the past year with some analysts predicting that it could continue to rise to as much as $7 a bushel. The global credit crunch has also seen investors move their funds into farmland which unlike residential and commercial property values has risen by more than 10 per cent in the first quarter of 2008.  But what has really increased demand for farm land is the growth in what is being referred to as the “lifestyle farmer” referring to the wealthy city dwellers, celebrities and overseas buyers who are seeking a slice of idyllic rural England and who want to own a farm more as a hobby than a commercial enterprise. Knight Frank figures for 2007 show that 38 per cent of farm land was bought by agricultural enthusiasts compared to 32 percent sold to traditional farmers last year with other reports suggesting that this figure could be as much as 45 per cent.

Notable lifestyle farmers include:-

Madonna and Guy Ritchie who bought Ashcombe House, Dorset with 1,134 acres of land in 2001.

Alex James the bass guitarist with Blur who purchased a farm in the Cotswold and Roman Abramovich the Russian Billionaire and Chelsea owner who bought a 1,500 acre estate in West Sussex in 2000.

This demand and shortage has naturally impacted the cost of farm land with The Independent reporting in August 2007 that the cost of farm land had risen by 27.3 per cent in the year to June 2007, the fastest rate of growth since 1977 and that average values were at £3,805 per acre up from £2,988. However, The Independent has more recently reported in April 2008 that land had risen further with arable land rising to as much as £5,500 per acre with highs of £6,000 per acre being achieved in the hotspots of Kent and Dorset.

As the future is considered in the current economic climate, trends do not show any letting up. Jeremy Zeid, an arable market specialist at estate agency Carter Jones estimates that prices will grow by 10 and 20 percent in the next year.

Therefore those wishing to buy into the English countryside in the near future should move fast before they are priced out of the market and to ensure that they are able to achieve their aim as well as potentially buying a good investment.

Max Storey Director of Elite Property Search commented “we are seeing an increase in the demand by buyers for the use of our services. Buyers are particularly looking for us to identify and contact farm owners directly so that they get to know of farms that are privately available first.”

For further information contact Elite Property Search on 01202 766566.

UK Property News archive