According to international property consultant Knight Frank, the average value of UK farmland is nearly back at peaks last seen in the autumn of 2015, according to new results from the Knight Frank Farmland Index. Prices for bare agricultural land rose 1% to just over £8,300/acre in the third quarter of this year, taking annual growth to 13%.
Liam Bailey, global head of research at Knight Frank reports that Farmland real estate outperformed all the other asset classes that we track during the past three months. Over a 12-month period it was only just bested by gold.
Investors view farmland as a safe haven, particularly now for its potential as a hedge against inflation. Demand is being underpinned by both tax and environmentally-driven buyers, according to the analysis from Andrew Shirley. The government's growth agenda and mooted planning reforms could also see more farmland required for new developments and infrastructure.
However, price growth is slowing, says Knight Frank, and Q3's rate of expansion was the slowest since early-2021.