North East deals quietly creeping up
Over £70 million of agricultural bare land and equipped farms were transacted by regional firm George F White LLP during 2013 with average values for bare land deals handled by the firm reported at £6,904 according to their recent research. With the RICS/RAU Rural Land Market Survey reporting opinion based prices of bare land in the North East at approximately £7,000 and Knight Frank reporting an average for England at £6,882 per acre it’s clear that land prices in the North East are gaining momentum. Claire Bainbridge, Director of Research commented that “The North East is clearly holding its own with the increase in land values, and with the RICS/RAU survey showing a 9% increase in the North East over the second half of the year the impact of a limited supply of good farmland is taking hold.
It will be one of the reasons for the large number of deals which have been conducted privately by the firm. Over 65% of the agricultural bare land and equipped farms transacted by George F White were done privately and more significantly 98% of bare arable land transactions were handled privately”.
Michael Bell from the George F White Alnwick office commented that “with good quality land in short supply, and increased demand from within and outside the region by not only farmers but also a significant number of investor clients it’s easy to understand why certain land types are increasing in value throughout the region. Bare arable land is at a premium, with some deals nearly reaching the £9k per acre mark, but also good quality pasture land holding its own. Smaller, less well equipped hill farms are not as well sought after at present yet could still prove to be a good investment for the right client”.
Tom Mason from the George F White East Yorkshire office added that “the perception is that larger well equipped units are more often than not openly marketed, however we have been involved with a number of significant farms and estates that have been handled privately. Of the 10,600 acres handled by the firm in 2013 over 65% of the deals done were private transactions”
Michael also stated that the increase in private deals will be due to a number of reasons, “often clients want to handle deals off market to remove some of the pressure of selling, to keep an element of control as well as the potential for a premium price over market value.”