Land Management Review
As specialists in rural land management, we have conducted a review of farmland values for 2010 during a successful year for the firm that has resulted in the continued expansion of its dedicated rural department.
We have been highly active in land sales and valuations and are pleased to report we have been handling agency instructions from farm, woodland and rural estates totalling over £104 million since the start of April 2010.
Whilst land values vary broadly throughout the country based on location, land and soil type, a guide to average sale values achieved by CKD Galbraith this year is as follows:
- Best Arable - £6,000 plus per acre
- Good Arable - £4,500 to £6,000 per acre
- Second class Arable / Silage - £3,000 to £4,500 per acre
- Rotational Grass - £2,000 to £3,000 per acre
- Permanent Pasture - £1,000 to £2,000 per acre
- >Hill / Rough Grazing - £100 to £1,000 per acre
- Forestry Planting land - £700 to £1,000 per acre (occasionally in excess of £1,000)
We have handled an increased acreage of land for sale in 2010 with prime arable farms in the east of the country being most in demand whilst good quality arable/silage land in the west in prime dairy areas also highly sought after.
Simon Brown, partner and head of our farm division said: “Prices for prime land have remained steady and there is no reason to forecast a drop. If anything we expect to see a slight rise in prices. Land is a good long term investment and the signs for the arable sector look promising provided that the cost of inputs do not spiral upwards too much. However, investors are looking for a return on capital and are put off if the residential element of the farm comprises too high a proportion of the value.
“Land values will hold firm for the year to come with the very best farms and blocks of land, particularly in locations with a high local demand, creating a very competitive bidding process. A significant development we have experienced this year is the disparity which has developed between the value of hill land capable of being planted for trees and hill land which has restrictions such as SSSI’s (Site of Special Scientific Interest) and National Park status where there is no forestry potential.”
An important aspect of rural land management is SRDP funding which can have a major impact on the direction in which any rural business chooses to go. As such we have strengthened our team earlier in the year taking on two former SGRPID (Scottish Government Rural Payments and Inspections Directorate) officers for its Elgin and Ayr offices offering expert advice across all grant applications. The firm is happy to report a success rate of 90% in the latest round of SRDP funding applications achieved on behalf of clients.
Simon Brown said: “The recent limit of £200,000 on the value of grants imposed on capital projects will see a reduction in the number of comprehensive whole farm steading schemes being proposed. As a firm, we also recognise that the procedure is becoming more complex and that early indications for 2011 and beyond are that funding will be harder to obtain. However, there is still scope for funding relating to smaller scale capital schemes including business development and renewable energy.”
Developments throughout the year include the take-over of Donalds Chartered Surveyors and the opportunity for CKD Galbraith to build on the existing links with the AMC; a new partnership formed with Macaulay Land Use Research Institute in Aberdeen to produce topographical maps for individual farms due to SFP (Single Farm Payment) penalty concerns as a result of inaccurate measurements; and the establishment of a dedicated renewable energy department giving advice on both small and commercial scale renewable energy projects including wind power and hydropower, as well as anaerobic digestion and photovoltaic projects.
If you would like to discuss any aspect of the review above please do not hesitate to get in touch with Simon Brown.