What does 2014 hold for land and farm markets?

The land and farms team at George F White achieved sales and acquisitions totalling more than £40m last year

Sam Johnson
Sam Johnson

The land and farms team at George F White achieved sales and acquisitions totalling more than £40m last year with a proportion of this being covered by private disposals and acquisitions - a trend we see increasing for reasons including the fact that some vendors wish to retain privacy and avoid the attention that a sale inevitably draws.

Provided you are taking sound advice, a private sale may well attract a premium. This is because neighbouring landowners look to retain control of the land and prevent it coming to the market as they would prefer not to have to compete against each other in what is often a once-in-a-lifetime opportunity.

This ultimately constrains the supply to the open market. It is a strong sellers’ market and there are plenty of vendors taking advantage of it – they just want to more discreetly.

At the same time, private investors are securing land off market, while, in many instances, it suits the purchaser that the vendor continues to farm the land either as a contractor or tenant.

Of course these high prices do not apply across the board to every acre and as such, it is key to have the right agent on board with an appreciation of not just what is happening on a national and regional basis but often what is happening more locally, almost on a parish by parish basis.

It is evident that there continues to be a clear divergence between prime quality land in the right location and poorer quality land.

Due to the shortage of land coming to the market, buyers continue to be increasingly discerning.

Farmland continues to outperform many other asset classes over the mid to long term, although the recent bounce in equity values means that the FTSE 100 has performed more strongly over the past year as investors recover some of their appetite for risk.

Despite the slight recovery of the stock market, farmland will continue to have a valuable role to play in investment portfolios.

While stocks and shares are back in favour, the markets remain volatile. Land offers something more tangible, yet still has the potential to provide good capital appreciation.

For many potential vendors, now may be the time to consider sales while finance is cheap and demand for land continues to entirely outstrip supply.

Among the successful sales undertaken by our North Yorkshire region include Morton Grange Farm, a first-class mixed farm extending to 535 acres sold in excess of its £4.5m guide price following strong interest locally and nationally.

The land and farms team at George F White have now turned their attentions to preparing the farms that they are instructed on marketing in spring 2014 which includes a portfolio of rural property situated on the edge of the Durham and Hartlepool border.

:: Sam Johnson, land and farms team, George F White

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