Over the past 12 months, despite the political and economic uncertainties that have hindered many business sectors across the UK as a whole including the Northwest, here at AB we are still experiencing a clear and strong demand for land and rural property. This demand spans bare land parcels of all sizes across Lancashire and Cumbria, smallholding units up to 50 acres and including dwellings and buildings, and fully-equipped commercial farms.
Throughout our regions we have the full range of land types, with Grade 4 and 5 moorlands in the Bowland Fells, to Grade 1 vegetable and salad growing soils of West Lancashire, and as ever, it is often land quality and location that holds the greatest key to demand and values. We are experiencing Grade 3 and 4 grassland pasture achieving £7,000 – £8,500/acre, with quality Grade 2 and 3 land often reaching and exceeding £10,000/acre.
Demand is predominantly coming from agricultural businesses looking to expand, purchasers with development sale income to Rollover into new agricultural assets, amenity, and lifestyle purchasers, and environmental, investor and non-farming buyers who see farmland presenting a real asset investment opportunity that is high in environmental value. This final ‘buying sector’ appears to be continually expanding and has significantly increased over recent years as the government continues to place greater emphasis on decarbonising the economy and environmental objectives, resulting in farmland being in demand for a continually broadening range of uses. In the Northwest, given the population density and increasing infrastructure requirements, it is expected this environmental sector will only increase, as business, industry and local government organisations look for local land to meet such environmental off-setting objectives.
2023 has seen fewer whole commercial farms coming to the market, however those farms being marketed have received strong levels of demand, as we see the farming sector often taking the generational view regarding new acquisitions. The quantity of agricultural land marketed nationally is also reducing and has been reducing for a number of years, however the current economic conditions, with levels of inflation and high interest rates, are starting to put pressure on some farming businesses so it will be interesting how this impacts the market going forward. On the whole, banks are still keen to lend but the profitability and proven budgets of the farming business are as critical as ever to gaining finance approval.
Recent price fluctuations for input costs have also impacted businesses, and the reduced milk price over 2023 has affected large swathes of central Lancashire and Cumbrian dairy farms. Having said the above, there still appears to be a waiting pool of buyers and capital, showing no current signs of diminishing, and we expect agricultural land and property to continue on its own, highly demanded, path as we head into 2024. For further advice and updates contact any of our Rural Property Surveyors.