Demand for Scottish farmland increases
By Bridging Loan Directory -
Demand for commercial farmland in Scotland grew during the second half of 2011 as prices dipped, says the latest RICS Rural Land Market Survey, H2 2011.
This increase in interest was driven largely by industrial farmers looking for good quality land. A total of 36% more surveyors reported increases rather than decreases in potential buyer interest in the six months to December, while demand for residential farmland fell away (-10%).
The average price per acre in Scotland dipped slightly during the second half of the year with chartered surveyors reporting an average price per acre of £3500*, the lowest in Great Britain. Across the country, most areas saw prices increase with the West Midlands experiencing the most significant rises.
Supply of land coming onto the Scottish market dropped off in the final six months of 2011. 36% more surveyors reported a decrease rather than an increase in (non-residential) supply coming on to the market, while residential farmland was also in negative territory (-9%).
Despite prices falling towards the end of last year, surveyors in Scotland are upbeat over future prices, with many expecting the commercial farmland market to grow over the coming 12 months (net balance +45), while expectations are somewhat more cautious for the residential land sector (zero net balance).
Demand in Scotland grew strongly towards the end of 2011, with surveyors reporting a marked increase on the previous six months.
Despite this, land prices fell away and Scotland now has the lowest farmland values in Great Britain.
Nevertheless, surveyors are optimistic over future prices of commercial farmland, with a significant majority expecting values to increase over the next 12 months.
Sue Steer, RICS spokesperson