Brexit hitting farmland values

The current subdued demand for farmland, with falling land prices and a lack of land coming onto the market, is a reflection of the current Brexit uncertainty, according to the Royal Institute of Chartered Surveyors (RICS).

The results of the organisation’s most recent Rural Land Market Survey indicated a 9 per cent drop in farmland values, marking the fourth consecutive report in which demand had reportedly declined.

Breaking the market down, the survey said that anecdotal evidence suggested demand for higher-quality land remained stronger in comparison – with lower-grade farmland often proving difficult to move.

Most purchases continued to be made by individual farmers, with just under a quarter of purchases being made by “lifestyle” buyers. Investments from agricultural businesses and institutional investors both accounted for just under 10 per cent.

“Farmland prices have fallen from their peak in late 2014-early 2015 due to weaker demand from farmers, who are the main buyers of farmland,” said Jason Beedell, a partner at Strutt & Parker.

“Where there is strong local interest, buyers are paying similar prices to the peak; elsewhere, land is struggling to attract interest and sell,” he concluded.