Farmland sales

Rural property firm reports healthy trends in demand and supply

The Scottish farmland market is seemingly as busy as normal despite the drawn-out uncertainties surrounding Brexit and the unknown state of future farm support policies.

Rural property specialists Galbraith say they’ve brought farms worth more than £22.5 million to the market this month alone while both Aberdeen and Northern Estates and Strutt & Parker report healthy supply/demand trends.

“We probably have as many farms on offer now as we did at this time last year,” said Duncan Barrie, head of Galbraith’s farm sales centre in Stirling.

“Prices are also remaining stable, with more or less everything we had on the market in July last year having now sold. Money is extremely cheap for borrowers at present, of course, allowing buyers to obtain extremely attractive rates, which is helping to fuel sales.”

With Galbraith having sold 25,000 acres of farmland across Scotland and Northern England in the past year, and with a fresh 4,328 acres now available, Mr Duncan played down the Brexit effect, suggesting that while uncertainty was maybe causing some potential sellers to hold back, others were moving ahead whatever Brexit brings.

“There will be some thinking that this is as good a time as any to make a change,” he said, saying buyers will generally be looking way beyond Brexit.

“If you’re taking finance over 30 years and planning for future generations, holding off until Brexit is sorted doesn’t seem so relevant.

“Equally, while land values have obviously dipped at times in history, they’ve generally held their value pretty well.”

Aberdeen and Northern Estates’ director James Presly expressed a similar view, commenting that the first six months of 2019 had seen a healthy demand for farms and farmland, albeit underpinned by a relatively low supply to the market.

Announcing the release onto the market today of a 348-acre mixed livestock and arable farm near Maud, for offers over £1.65m, he said: “As we approach summer, there has been an increase of properties being launched for sale which is traditionally the trend during this time of the year.”

Strutt & Parker’s head of estate and farm sales, Robert McCulloch, said that while 2018 had seen more farms offered for sale than in the previous 20 years, his impression of 2019 so far was of a slower release of properties.

He said: “The test of market strength this year will be shown by how quickly the farms which are now available for sale actually find a buyer.

“In terms of prices, there are huge variations with good arable farms in the eastern part of the country still selling for very high rates per acre, often driven by local buyers.

“There’s also huge demand for rough grazing and hill ground which has forestry potential, backed by the Scottish Government drive to ensure 10,000 hectares a year are planted.

“As a result, the value of planting land for hill ground is getting up to £2,000 an acre while its agricultural value will be only a quarter of that, at best.”

Good arable farms in the eastern part of the country still sell for very high rates per acre.