The professional view: Seamus McLaughlin, Martin and Company

30th November 2016

Areas of expertise: farming industry, landed estate, capital taxation.

“The value of agricultural estates has certainly dropped off compared to two or three years ago, but a bit of over-enthusiasm on pricing and expectations on marginal prime property remains," says Seamus McLaughlin of Martin and Company Chartered Accountants. "The days of £15,000 per acre are pretty much gone and £12,500 is closer to the norm, with more marginal properties exchanging at about £9-10k. Every property will have its nuance though, and more than ever, the final value of farmland will be based on its own special factors.”

“Plus now the uncertainty regarding support payments for agricultural land going forward has to be factored in. The devaluation of sterling is offsetting this a bit, with banks feeling a bit more confidence to offer long-term, fixed rate loans based on stronger export prospects for grain.”

“The one thing that has surprised me is that, given the devaluation of sterling, we haven’t seen more Europeans coming into the market. A couple of years ago, we had quite a few buyers from Germany, Switzerland, Greece, so with everything up to 25 percent cheaper for European buyers, you’d expect those buyers to keep on coming.  It seems to imply that agricultural land in Hampshire, for example, was ‘fashionable’. Or maybe the fundamental economics were misinterpreted before, but taking fashion and emotion out of it, there’s no question that UK land offers good value to foreign investors and buyers right now”.

“I suspect we’re in one of those quirky periods. Outright quality will always find a level, but in Hampshire, for example, a couple of farms which were just a little bit short of that quality have been withdrawn from the market. That shouldn’t really be happening, because if you get the price right farming land will always find a buyer.”

Martin and Company’s view:

  • Prices on agricultural land down vs 2-3 years ago
  • Devaluation of sterling is helping grain prices and therefore making farming land more attractive
  • However, uncertainty regarding EU support payments balances this out

The professional view.

A critical aspect of what Middleton Advisors offers is the ability to draw on different strands of expertise from across the full spectrum of property and professional services. The Middleton 'professional view' blog offers topical comment from experts and professionals to provide insights into the current market for prime property in London and the UK countryside – what is driving activity and prospects, trends, legislative changes, opportunities and threats.

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