Analysis: England farmland market by type, size, price, area

Arable land and smaller farms have dominated a busy market in England in recent years, with values being more variable depending on the year and location.

Farmers Weekly has analysed sales across the period 2014-2018 using information from Strutt & Parker’s Farmland Database, which records all farm and bare land deals on the open market.

See also: 6 things we know about the 2019 farmland market

Across the five years, the busiest region was the East of England with 234 sales (out of a total 1,166), while Yorkshire and Humber saw the fewest sales with 99.

The year that achieved the most sales was 2018 (256), with 2014 seeing the fewest (206).

Arable farms were by far the most frequent to the market, with a total of 510 sales over 2014-2018. The next most common was residential (farms where residential property accounts for 50% or more of their value), with 175 sales.

In terms of size, 970 (83%) of farms on the market were between 100 and 500 acres, while 137 were 500-1,000 acres and just 59 were more than 1,000 acres.

Average land values by region

The data show that 2014-2015 was the peak of the market for arable land and prices have since been falling.

In contrast, pasture prices have continued to increase in most regions.

The highest average arable price in 2014-2015 was £10,700/acre in the East of England, with the region’s average price decreasing by 15% in 2016-2018.

South-west England saw the lowest average arable price in 2014-2015 at £9,000/acre, though this increased by 10% to £9,900/acre in 2016-2018.

Yorkshire and Humber was the only other region to see an increase in arable prices, with an average of £7,600/acre in 2014-2015 rising by 18% to £9,000/acre in 2016-2018.

South-east England achieved the highest average arable price in 2016-2018 at £10,100/acre, despite a 5% decrease from £10,600/acre in 2014-2015.

The north east saw the biggest decrease (-34%), from £10,500/acre in 2014-2015 to £6,900/acre in 2016-2018.

However, the area achieved a 24% increase in average pasture prices from £3,700/acre (the lowest across all areas) to £4,600/acre in 2016-2018 (still the lowest in all areas).

This increase was second only to Yorkshire and Humber, which rose from £5,100/acre in 2014-2015 to £7,000/acre in 2016-2018.

Meanwhile, south-east England achieved the highest average pasture price in both 2014-2015 (£8,100/acre) and 2016-2018 (£8,200/acre).

The east of England bucked the trend by being the only area to record a lower average pasture price in 2016-2018 (£6,700/acre) to 2014-2015 (£6,800/acre).

South East

The south East saw 193 sales across 2014-2018, with arable the highest type (61). Generally residential, mixed and arable farms make up the majority of the marketed farms in the area and, unusually, residential farms make up more than a quarter of all sales (59).

Will Whittaker, associate director at Strutt & Parker, said: “The region is attractive for non-farming investment and lifestyle buyers, and there have been some large housing developments in the area, giving rise to some big rollover buyers.

“Though there have not necessarily been more developments than in any other region, house prices are higher so the development land is worth more.”

Since many of the properties purchased by lifestyle buyers include arable land, this pushed the average arable price up, which explains the area having the highest average arable price in 2016-2018 of £10,100/acre.

South West

More land has come onto the market in the South West recently than normal, with 2018 recording 58 sales, the highest figure of the five years.

However, there remains a scarcity for certain types of properties, such as larger farms, with properties of more than 1,000 acres accounting for only nine of the 211 sales.

William Morrison, director at Strutt & Parker, said: “A large number of rollover buyers in the market are helping to support average prices.

“Private sales may account for up to 50% of sales in the region.”

North

The north east and north west saw just seven farms of more than 1,000 acres sold from 2014-2018 out of a total 124.

Will Parry, director at Strutt & Parker, expects an increase in 100-250 acre blocks of land to come up in future, with farmers off-loading land separate to the main holding or tenancies coming to an end.

“The North West rarely sees larger, commercial or arable farms, and I’d say more farms are sold in the North East than the North West,” said Mr Parry.

“You tend to get more residential and lifestyle farms in Cumbria and Lancashire whereas Northumberland and County Durham farms are sold to investors or farmers. There is also quite a bit of coal land and poorer arable land in County Durham and south Northumberland.”

The highest number of sales by farm type was 32 for grazing livestock in lowland areas – farms with less than 50% of their total land in the less-favoured area.

Private sales account for 20-30% of the market.

East Midlands

Arable farms were sold the most in the East Midlands (110), with 2015 seeing the highest number of these sales (31) when prices were averaging £9,500/acre.

The area has a wide range of values, which is linked entirely to location, rather than soil quality, meaning there are opportunities to buy quality land that yields better returns than the most expensive land, said Sam Holt, senior associate director at Strutt & Parker.

“Generally, buyers with rollover money are driving the market, albeit they are increasingly fastidious,” he said.

“The market is generally flatter in areas that are limited to farmer buyers. There are not a huge amount of off-market deals within the region but farmer-to-farmer deals can be difficult to track.”

Central and West Midlands

Mixed farms accounted for the highest number of sales in 2014-2018 (46), followed, unusually, by arable with 37.

In the Cotswolds part of the region, residential farms and estates and equestrian properties often make up about 50% of the market share in any one year, said Matthew Sudlow, director at Strutt & Parker.

“The buyers are often lifestyle-minded, coming out of London, attracted by the connectivity of the M4 and M40 corridors,” he said.

“As we head further west in our region, although lifestyle buyers are becoming more prevalent, farmers and local landowners are often the key buyers.”

Private sales account for about 25% of the market.