Land News

Farmland values to rise again in 2012

Knight Frank, 23 Sep 2011

The general direction of the land market is still upwards as investors look to tangible assets.

According to the Knight Frank Farmland Index, bare agricultural land is 5% higher than 12 months ago and almost double the prices being achieved five years ago,” says Andrew Shirley, the firm’s head of rural research. “In terms of capital appreciation, farmland has outperformed many other asset classes over both the short and long term. The FTSE 100, for example, has lost around 10% of its value in the past three months alone and has grown by a miserly 6% in the last decade,” he adds.

The land market is becoming increasingly polarised with land that attracts competitive bidding due to its location or quality still achieving very strong values.

Prices are likely to remain flat or weaken slightly in the final quarter of the year, but will rebound in the first half of 2012, he predicts. “The general direction of the land market is still upwards as investors look to tangible assets supported by strong fundamentals.”