investors. Demand is so strong that prices - PDF document

investors. Demand is so strong that prices Q111Q105Q106Q107Q108Q109Q110Q112Q113Q114Q115 0100200 600 Index (Q1 2005=100) FARMLAND INDEX KNIGHT FRANK PRIME FTSE 100 GOLD 201520051995198519751965 02,0004,0006,0008,00010,000 Source:Knight Frank Rural ResearchSource:Knight Frank Rural Research FIGURE 250-year farmland performance£/acre Farmland performance3 months +2%12 months +10% 5 years +49%10 years +192%50 years +5,042%RESEARCHFARMLAND INDEXQ1 2015 Head of Rural Research The ability to invest a significant amount of cash into an asset that will not disappear and has good long-term potential for capital growth seems to be the For the latest news, views and analysis on the world of rural property, visit For more detailed information on the issues affecting UK landowners and farmers, including the latest on agricultural commodity and input markets, please request a copy of the Knight Frank Rural Bulletin or go to The average value of Scottish farmland rose by almost 2% to £4,329/acre in the first half of 2014, according to the This takes growth over the past 12 months to 8% and prices are now 223% higher than they were 10 years ago. “There has been a lot of talk about the impact of the referendum, CAP reform and land reform, but there is much more confidence in the market for agricultural land than you might imagine, particularly for good arable ground,” says farm agent “The fact that all the uncertainty hasn’t caused values to dip underlines the inherent strength of the market,” adds James. “Supply is still very limited and demand Because relatively little land does come to the market, farmers will always try their hardest to buy anything nearby that does become available, points out valuer and consultant Michael Ireland. “I don’t think any of the current issues are likely to dim Another sign of the confidence underpinning by Knight Although a truly stunning sporting and upland farming business, the estate’s potential to generate hydroelectricity was one of the main reasons for the purchase, explains Ran Morgan, Head of Knight Frank’s Edinburgh office. “Despite all the hype over independence, there is a real appetite for Scottish land holdings from investors, especially from overseas. Potential buyers are particularly interested in estates that can produce significant income in the form of renewable energy, a massive resource for Scotland, or via a commercial agri-business.” Auch & Invermearan is the second £10m+ sale that we have completed in the last 18 months that has attracted interest from around the globe and been sold to investors out with Scotland. Traditionally, Scotland’s land market is more active in the second half of the year, so the next six month could be a sterner test of its resilience. But Knight Frank expects demand to continue outstripping supply with average “I think some people will be holding back sales until the after the referendum because they have underestimated current demand, so I am not expecting a huge amount to come 0100200300400500 SCOTTISH FARMLAND ENGLISH FARMLAND FTSE 100 GOLD 02,0004,0008,00010,000 GOOD ARABLEARABLE GRASS AVERAGE ARABLE PERMANENT PASTURE HILL Q212Q204Q205Q206Q207Q208Q209Q210Q211Q213Q214 FIGURE 1Scottish farmland capital value performance versus other assetsSource: Knight Frank Residential ResearchSource: Knight Frank Residential Research FIGURE 2Scottish farmland values by type£/acre Farmland performance (average all types, unweighted)6 months +2%12 months +8% 5 years +47%10 years +223% SCOTTISH FARMLAND Head of Rural Research For the latest news, views and analysis on the world of rural property, visit Scottish FarmlandIndex Q2 2014 DATA DIGESTRECENT MARKET-LEADING RESEARCH PUBLICATIONSKnight Frank Research Reports are available at KnightFrank.com/Research The Rural ReportWinter 2014 THE CRITICAL LISTThreats and opportunities for landownersFARMLAND VALUESOur latest research and analysisVOTE FOR ME!Politicians try to win your voteEMPLOYMENT SPECIALTop tips for country house and estate owners Winter 2014 RURALREPORTTHEA UNIQUE GUIDE TO THE ISSUES THAT MATTER TO LANDOWNERS The Wealth Report2015 RESIDENTIAL RESEARCHAndrew Shirley Head of Rural Research +44 1234 720534 andrew.shirley@knightfrank.comPRESS OFFICE Lizzie Copestake+44 20 7861 1033 For the latest news, views and analysison the world of prime property, visitKnightFrankblog.com/global-briefingGLOBAL BRIEFING This report is published for general information only and not to be relied upon in any way. Although high standards have been used in the preparation of the information, analysis, views and projections presented in this report, no responsibility or liability whatsoever can be accepted by Knight Frank LLP for any loss or damage resultant from any use of, reliance on or reference to the contents of this document. As a general report, this material does not necessarily represent the view of Knight Frank LLP in relation to particular properties or projects. Reproduction of this report in whole or in part is not allowed without prior written approval of Knight Frank LLP to the form and content within which it appears. Knight Frank LLP is a limited liability partnership registered in England with registered number Our registered office is 55 Baker Street, London, W1U tracks the average price of bare (no residential property or buildings) commercial (productive arable and pasture) agricultural land in England. The quarterly index is based on the opinions of Knight Frank’s expert valuers and negotiators across the country, which take into account the results of actual sales conducted by both the firm and its competitors, local market knowledge and client and industry sentiment. When combined with UK Rural Bulletin Autumn 2014 Rural PropertyThe latest research on farmland AgricultureCAP reformDEFRA reshufe Welcome to the latest issue of The knight frank Rural bulletinThe UK’s political landscape is going through a period of immense upheaval and scrutiny.nal hurdle in their quest for independence, virtually on the eve of the referendum caused widespread panic in Westminster and led to offers of more devolved powers. If Scotland’s replacement for Stamp Duty Land Tax is anything to go by (see page 6) landowners and property markets.South of the border, UKIP now has a foothold in parliament following its Clacton by-election victory. This will inevitably inuence the policies of the Conservative and Labour parties in the run-up to next year’s General Election.The political posturing is already well controversial Mansion Tax plans (page 6) and all parties, of course, pledging to protect the will be of more immediate concern to many farms and estates, it will be worth preparing for the longer-term more fundamental changes that could be on their way.All of these issues and many more are in any way please do get in touch. You can date with the latest rural property news on . You can also follow us on Twitter Andrew ShirleyHead of Rural Property Research Rural Bulletin Autumn 2014