We are delighted to publish our report on farmland values for the third quarter of 2011.

The information is taken from our Farmland Database, which has monitored all farmland sales of over 100 acres in England since 1996.

Summary

• Average arable land values remain strong at £6,874 / acre
• 6.5% increase in supply of arable land to the market compared to the same period in 2010
• Demand remains strong particularly from farmers

Arable values level out but prices remain strong

Average arable land values leveled off during the third quarter of 2011. English land finished the quarter at an average of £6,874 / acre against a quarter 2 figure of £6,908 / acre. The small change has largely gone unnoticed with farms still selling well. There are several regions which have seen price increases - see overleaf. Indeed at the time of writing Strutt & Parker have agreed sales in September at levels in excess of this figure so we expect to see average values increase during the last three months of the year.

Strong prices continue to be driven by purchasers who are buying land close to their existing holdings and are prepared to pay extra for what they consider a once in a generation opportunity to expand their farm. There is also strong demand from buyers who have sold an asset and are seeking to roll over capital gains made. Buying land provides them with roll-over relief from capital gains tax which defers payment of CGT so these buyers are often prepared to pay a premium for land in order to delay paying tax. Pasture land however dropped back marginally at an average figure of £6,242 / acre although this is still 11% higher than 12 months ago.

Read the full report: English Farmland Review Q3 2011