Farmland values continued to rise during the first quarter of 2025, defying ongoing political and economic headwinds that have been weighing heavily on the agricultural sector.
New figures reveal that average arable land values in across England and Wales increased by 0.9% to £9,811 per acre, while pastureland rose by 0.8% to £7,959 per acre.
Compared to the same period last year, arable land values have climbed 1.5%, and pasture has seen a 1.9% rise.
“Supply is significantly down year on year, as some landowners continue to delay property launches while evaluating their positions following announcements made in the autumn budget,” said Andrew Chandler, head of rural agency at Carter Jonas.
“However, there is evidence to suggest that supply is improving as we move into the traditionally busier sales period.”
While arable land remains 3.5% below its 2016 peak, grassland values have surged, now standing 4.5% above their previous record.
The northern regions have largely driven the recent growth, with regional variations in market performance underscoring the importance of local dynamics.
Competition for prime agricultural land remains intense, with demand far outstripping available supply.
This has led to stronger price growth for top-tier land, particularly where strong commercial interest is present.
Sophie Davidson, research associate at Carter Jonas said there was anecdotal evidence of values being achieved well above guide prices where land is well-positioned.
“In particular, we’re seeing active demand from commercial farmers for equipped farms with existing infrastructure, or potential for development.”
Outside of high-demand areas, however, some types of land are facing increased price sensitivity.
This may prompt value readjustments or encourage sellers to divide land into smaller lots to attract a wider pool of buyers.
Despite the structural shifts underway in UK agriculture, buyer interest remains strong and diverse.
Commercial farming continues to drive the market, alongside growing interest from environmental and amenity-focused buyers, as well as those using rollover relief funds.
However, the recent suspension of new Sustainable Farming Incentive (SFI) applications could increase financial strain for some farm businesses already facing mounting challenges.
“Higher-than-target inflation, persistent wage pressures, and sluggish economic growth make it difficult to predict when and how quickly interest rates will come down,” Mr Chandler noted.
“The fallout from recent US tariff changes may push policymakers to act more swiftly to stimulate demand.”
He added that global uncertainty—fuelled by aggressive U.S. trade policies and ongoing geopolitical tensions in Europe and the Middle East—adds further risk to the outlook.
“Economic pressures continue to limit debt-financed purchases and tighten profit margins,” he concluded.
