Review of 2023

2023 has been a strong year for Stephensons Rural and Boulton & Cooper in terms of agricultural property sales. We are proud to maintain our position as the go-to agent in Yorkshire for farm and land sales. A review of the year provides the following key points:

  • For all agents, there was definitely a shortage of fully-equipped farms to the market in Yorkshire in 2023
  • The market for smallholdings remains very strong, especially from non-agricultural purchasers
  • Land price remains very location dependent
  • Small parcels continue to attract a premium over and above the agricultural value
  • Investors, rollover buyers and agricultural buyers are still at the forefront of land purchases

Many land sales that we have seen in 2023 have come from those looking at the low returns from their land and not being able to justify this against the strong capital value. Returns are unlikely to be much better in 2024 so we expect this trend to continue.

We saw some debt-related sales in 2023 and we do expect this to continue into 2024 as those on a Fixed Rate come to an end. Whilst there is talk of interest rates coming back down, we are unlikely to get to the record low levels that a number of farmers locked into for long periods. The days of long-term finance at 3% are over.

2024 could well bring with it an increased supply to a market that has generally been very short of supply for a number of years now. This can only be a good thing and should bring some good opportunities to the market for those actively searching. The best land for a farmer is often that ‘next door’ and there will however always be a very low supply of the land just ‘next door’.

Despite a difficult farming year, we expect demand to remain relatively strong. We are aware of a number of rollover buyers in the region actively searching for holdings or land. As long as land is being developed, these buyers will always be there. There are a number of farmers looking to expand production and the investor purchaser is still likely to be active as long as the tax advantages remain.

An increase in supply and stabilising of demand should point to a steadying of land prices. With land at historically high prices, we do not expect this to fall but do not expect it to continue to rise as it has done over the last 5 or so years.

Johnny Cordingley MRICS FAAV

Tel: 01904 489731

Email: jc@stephenson.co.uk

 

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