Agricultural land values still holding .

[Pilatus]

I find it interesting that the price payed for agricultural land is still holding.That is despite the uncertainty of the EU farm subsidy scheme, and if we leave the EU presumably that system will not be available to landowners???
I ask ,why are land values still holding at their current values.

 

[spin cycle]

iht dodge

 

[serf]

Rollover relief, safe place to store wealth, something tangible to show , not just piece of paper with some numbers on that could be worth sweet FA.... ect.

 

[midlandslad]

Simple rules of supply and demand. What will be interesting will be when supply levels rise and whether the demand is still there.

When you have top quality units such as this which fail to sell I would say there is an underlying concern that the market isn’t all that.

Binbrook Farm

 

[Yale]

The dairy farms still seem to be storming ahead,wonder if that bubble will burst?

 

[Will Blackburn]

The dairy farms still seem to be storming ahead,wonder if that bubble will burst?

If it’s a full on dairy farm then fixed equipment will be £1m plus

 

[Formatted]

Because farmland value isn't connected to its output; its valued for IHT and roll over relief, its an appreciating asset, and has a desirable quality for lifestyle buyers. The output of the land is a bonus, not the main reason you buy it.

 

[Tubbylew]

desirable quality for lifestyle buyers

I would say this above all else, iht and rollover also apply to other businesses, but a couple of cornershops haven't got quite the same appeal, there are many millions of folks in cities that don't want to live there any more than I would, who can blame them.

 

[Goweresque]

The same reason the price of gold is on the up - Governments the world over are printing money hand over fist, the world economy is going to hell in a handcart over covid and is up to its eyeballs in debt, if you're the equivalent of James Dyson with hundreds of millions in cash lying around, which looks a better long term bet, tens of thousands of acres of farmland in a stable country like the UK, or numbers in a bank's computer system?

 

[teslacoils]

There is f all else that is a) tangible and b) pays a return. I'm let to believe ring fenced units of 200ac plus with a house are in high demand, as are big blocks of bare arable land.

 

[ollie989898]

Soon all change with a 1% wealth tax...

 

[S J H]

I find it interesting that the price payed for agricultural land is still holding.That is despite the uncertainty of the EU farm subsidy scheme, and if we leave the EU presumably that system will not be available to landowners???
I ask ,why are land values still holding at their current values.

Have you worked out the return from the sub, to the value of land?

 

[egbert]

Chance of development too.
Inc ag tie house potential....anything above a postage stamp locally apparently has potential to become a 'holding'.
anything that'd support 70-80 cows and 250 yows?
That's a compact estate with sporting potential!

 

[Eolas Álainn]

Are people finding this all across the UK? Cause I've noticed prices going up and down across Scotland. At the moment they are holding steady but I wouldn't be surprised to see them fall come Jan.

 

[Y Fan Wen]

I have heard a story of a large mountain farm put on the market and there had been no requests for viewing at all.
The size of the farm means that we are talking multi millions but there is no lifestyle element and the future for us mountain men is very very shaky.
Meanwhile a 25 acre hill smallholding has been getting a stream of viewers.

 

[teslacoils]

Anything under the value of a London three bed doesn't even need a viewing. Urban exodus.

 

[jendan]

Simple rules of supply and demand. What will be interesting will be when supply levels rise and whether the demand is still there.

When you have top quality units such as this which fail to sell I would say there is an underlying concern that the market isn’t all that.

Binbrook Farm

At £8 million,it would probably only be investment or Dyson territory.Not many farmers can scale up to that level.Even with roll over money,it could be too many eggs in one basket.I think smaller mixed/lifestyle farms are still moving.At least Northern England,Southern Scotland,anything £1-£2 million,100-250 acres seems to be moving fairly quickly. Under offer within 4-5 weeks or so.

 

[jackrussell101]

The biggest bearing I believe on prices of anything is interest rates.

 

[Tarw Coch]

The biggest bearing I believe on prices of anything is interest rates.

Indeed, if interest rates were 15% like they were when I was a lad, no one would be able to keep up with the interest payments on land at 10k an acre and if you had the money sitting in the bank it would be doubling itself every 5 years so would be worst off buying

 

[Goweresque]

Indeed, if interest rates were 15% like they were when I was a lad, no one would be able to keep up with the interest payments on land at 10k an acre and if you had the money sitting in the bank it would be doubling itself every 5 years so would be worst off buying

Two things - a) if interest rates were 15% then the entire economy would be borked (imagine someone having to pay £37k a year out of taxed income on their £250k mortgage, its just not going to happen) so we won't ever have them again, not under the existing world monetary setup. Japan has had zero interest rates for 20 years and counting. There is so much debt out there now that there are only two scenarios left - either interest rates stay low for ever, or the global monetary system collapses and all old debts and money disappear, to be replaced by a new currency. A sort of monetary reset. There can be no return to 'normal' interest rates (ie of the sort we have seen in the last 20-30 years), because no-one can afford anything other than ultra-low ones.
And b) very few people buy large amounts of land with borrowed money, its all done with cash from outside farming - roll-over and City money. Interest rates don't come into their thinking.