Rural Property Market Remains Positive as Farming Businesses Look to the Future

From complete working farms and productive farmland to smallholdings and rural lifestyle property, the market continues to attract buyers. Mark Barrow, Director and Rural Chartered Surveyor with H&H Land & Estates, gives an update on current demand, the factors influencing buyers and sellers and what the short-term future may hold.

 Although buyers are taking a more measured approach, demand for farms, farmland and property in rural areas across the North of England and Southern Scotland remains positive, according to H&H Land & Estates Director and Chartered Surveyor Mark Barrow.

 Higher interest rates and borrowing costs have influenced the market, but Mark says good farms and productive agricultural land in the right location are still generating strong interest.

 "We have seen some fantastic sales and there are certainly buyers out there," he says. "But it is a very localised market and understanding where demand is likely to come from is particularly important."

 The wider farming business behind a property is also playing a greater part in decisions as agriculture goes through a period of change. Interest rates, agricultural policy and changes to taxation, including Agricultural Property Relief, are all having an impact. Some borrowing arrangements and mortgages taken out during or shortly after the pandemic are also coming up for review, placing renewed focus on finances and future investment. And of course, succession is another major consideration for many farming families.

 "We are seeing a lot of time and thought going into what the future of the farm and business should look like," says Mark.

 "For some, that means bringing the next generation into the business and investing for the future. For others, it may involve restructuring, letting land or deciding whether the time is right to sell part or all of the farm."

 Such decisions should not be taken in isolation. Accountants, solicitors and specialist advisers all have an important role in helping families understand the tax, legal and financial implications and identify the most appropriate way forward.

 At the same time, opportunities are being created for farming businesses looking to expand. A complete farm coming to the market may offer the chance to establish or significantly increase an enterprise, while bare land can attract particularly strong competition when it adjoins existing holdings.

 "The opportunity to buy a neighbouring farm or piece of land may only arise once in a generation," says Mark. "For a farming business looking to expand, that can make it particularly valuable."

 When it comes to valuing farms and land, broad averages tell only part of the story. Land quality, acreage, buildings, farmhouse, location and access all influence demand, while neighbouring ownership can have a major bearing on the eventual price achieved for bare land. Recent H&H Land & Estates sales illustrate this.

 At New Mill, near Wigton, 38.13 acres of agricultural land with a guide price of £530,000 sold at auction at Borderway for £710,000, almost 34% above guide.

 At Crackenthorpe, near Appleby-in-Westmorland, 9.25 acres guided at £137,500 sold for £185,000, around 34.5% above guide.

 "Despite the difference in acreage, both achieved around a third more than their guide prices, demonstrating the competition that can develop for well-located agricultural land where local demand is strong." Says Mark

 Smallholdings are another area continuing to attract buyers, particularly those looking for a rural home with land.

 For anyone considering the future of a working farm, Mark stresses that the farm itself may be only part of the overall picture. "The assets of a farming business aren't just the land and buildings," he says. "There may also be livestock, machinery and equipment which need to be considered as part of succession, restructuring or a sale."

 It may not always be in the owner's best interests to sell every asset at the same time. Timing and method of sale can influence value, cashflow and tax implications.

 As part of the wider H&H Group, H&H Land & Estates works alongside livestock and machinery specialists to provide an appraisal of the full range of farm assets, while liaising with the client's accountant and solicitor.

 Looking ahead, Mark expects the market to remain highly localised, with buyers selective about where and what they invest in. However, demand for good-quality farms and productive land is expected to continue, particularly from established farming businesses seeking to expand.

 For sellers, preparation remains essential. Conveyancing is taking longer and issues involving titles, boundaries, access, rights of way or tenancies can delay a sale if they are not identified early. Planning and environmental considerations may also present constraints but equally can create opportunities that influence value and future use.

 "As qualified Rural Chartered Surveyors, our role is to understand the complete asset and where we can deliver the best value," says Mark.

 "Whether somebody is considering buying or selling a farm, land or rural lifestyle property, getting advice early gives them time to understand their options, involve the right professional advisers and decide on the best approach."

 H&H Land & Estates operates across the North of England and Southern Scotland, providing specialist rural property, land management and professional services to farmers, landowners, estates and rural businesses.