The Strutt & Parker Rural Land Briefing was held today (3rd February) at London’s Westbury Hotel. This annual seminar on UK agriculture and the rural economy offers attendees the chance to hear from some of the most informed and experienced farming and land specialists in the UK.
Mark McAndrew looked at land prices and the impending referendum on whether or not the UK would leave Europe.
“One month into this year and land prices are looking stable. Land buyers are positive and if there were real concerns about us leaving the EU this would already be factored into the price. The AgraEurope report, published last October, presents the worst possible scenario for British agriculture in the event of Britain voting to leave – it is based on the presumption that the Government would not support farming. This, in my view, is highly unlikely.
“Looking back at 2015 it was commonly perceived that land values had dropped, although looking at the whole 12 months the average was up marginally at 2%. The first half of the year was very buoyant in most areas and the second half, taken alone, was down.
I call this the East Anglia effect as that region depends far more on farmers than investors and performed badly throughout the year with prices down by 7%. The main problem is that the market is very volatile and unpredictable that if an agent is not looking at land every day of the week, as we do here at Strutt & Parker, they will end up getting valuations very wrong.”
So to sumarise I don’t foresee a downturn in land prices. Land will continue to be a good investment and one of those reasons is that just aren’t making it anymore.”
John McLarty, Head of Planning, called for the government and local planning authorities to work more closely to form detailed strategies that will tackle the housing crisis. “The existing approach propagates sporadic developments that put local infrastructure under pressure, and often don’t provide the right housing in the right places. This is because despite what the government might pledge on housing they do not always have much political influence at a local level.
“The government wants to promote growth and more homes. They are encouraging small scale developments of 10-15 houses around villages which will have a limited negative impact on services but a positive effect on sustaining local schools and businesses.
However, using the green belt land around market towns in the south east is the key to unlocking the housing problem. Sadly, until the government forges a joined up policy and encourages detailed local plans we will continue to see an uncoordinated, sporadic policy that will never adequately solve the housing crisis”.
Other speakers included George Chichester of the Farming Department and Stephanie McMahon, Head of Research at Strutt & Parker whose property analysis focused on both cyclical and structural shifts across all asset classes
