RICS Policy Unit

RICS farmland market survey Second quarter 2003

1

Second quarter 2003

RICS rural land market survey Great Britain MTR weighs on sales again though non-farm buyers still active •

•

•

Average farmland prices strengthen on back of first quarter rebound Sales activity still pegged back by concerns over the Mid-Term Review Pessimism over farmland price outlook recedes

The rebound in farmland prices continued in the second quarter, with the price per hectare (based on sales reported by chartered surveyors) breaking through the £8,000 mark. The four quarter moving average of prices (which smoothes out quarterly fluctuations) rose to £7484 per hectare. Sales activity was once again comparably weak, with the market continuing to be affected by concerns over the CAP Mid-Term Review (MTR). However, the significant presence of non-farm buyers, which accounted for 44% of sales in the latest quarter, has enabled prices to remain firm. Nevertheless, uncertainty remains evident on the part of both buyers and sellers, with declines in both demand for, and supply of land, though at a slower pace than in the previous quarter. With availability down more sharply than demand in the commercial sector, prices have remained robust; bare land prices experienced a marked rise in the latest quarter .

Weighted average agricultural land prices Price per hectare, England and Wales only

8000 7500 7000 6500

4 quarter moving average price

6000 5500 5000 95

96

97

98

99

00

01

02

03

Surveyors, however, remain firmly negative in their outlook for commercial farm prices, though pessimism receded in Q2. The outcome of the Mid Term Review has prompted expectations that market activity will undergo some degree of recovery over the next year. Demand for residential farms rose further, but is not rising as strongly as last year, reflecting a slowdown in the housing market in 2003.

Farmland prices and activity

Change over the past year

Vacant possession: England and Wales only

Demand

Availability

Weighted price

Price index

Wgtd Bare

Area Sold

No. of sales

% balance of surveyors reporting*

£ per ha

Q1 95 =100

£ per ha

000 ha

reported

1999 Q 1

6376

123

5327

3.6

84

-33

-41

Q2

7337

141

5779

4.5

138

-2

-8

Q3

7186

139

5979

9.0

152

-24

0

Q4

7204

139

5783

6.9

151

-37

-22

2000 Q 1

7660

148

7176

3.8

90

-28

0

Q2

7211

139

6006

4.9

120

-40

11

Q3

7082

137

5875

7.2

134

-41

9

Q4

6461

125

5794

5.9

128

-43

-19

2001 Q 1

7273

140

5455

4.5

73

-35

-56

Q2

7967

154

6552

4.2

70

-38

-52

Q3

7169

138

5628

6.8

137

-29

-45

Q4

7327

141

5756

5.8

130

-8

-43

2002 Q 1

7906

152

5900

3.0

71

3

-16

Q2

7579

146

6032

3.4

87

-2

20

Q3

7694

148

6400

6.6

135

-22

20

Q4

6390

123

5728

6.0

154

-16

-3

2003 Q 1

7817*

151

6111*

2.5

69

-33

-47

Q2

8034*

155

6872*

3.0

68

-21

-38

p = provisional data which is subject to revision in the next quarter * Balance = Proportion of surveyors reporting a rise in demand/availability minus those reporting a fall

2

RICS farmland market survey Second quarter 2003

National farmland market Farmland prices The upward movement in farmland prices continued in the second quarter according to chartered surveyors. The average price of vacant possession farmland per hectare rose to £8034, up from £7817 in Q1. The four quarter moving average, which smoothes out quarterly fluctuations, rose to £7484 per hectare. Based on this measure prices are little changed on year ago levels. This suggests that a stable housing market and non -farm buyers continue to support the market, despite a slowdown in sales activity.

Weighted average farmland prices Price per hectare,, England and Wales only

8000 7500 7000 6500

4 quarter moving average price

6000 5500 5000 4500 4000 3500 3000 90

91

92

93

94

95

96

97

98

99

00

01

02

03

CALP price data prior to 1995

Bare land prices The price of bare land jumped markedly in the second quarter, in comparison with the more limited increase in the overall farmland price level. The average weighted price of bare land was £6872 per hectare in Q2, up from a revised £6,111 in the first quarter. The four quarter moving average figure of £6278 per hectare, suggests that bare land prices have broken out of the largely flat trend seen over the past year. According to this measure, prices around 7% higher than the same quarter last year

Weighted agricultural bare land prices Price per hectare, England and Wales only

6500

6000

5500

4 quarter moving average price

5000

4500

4000 96

97

98

99

00

01

02

03

Reported sales The total number of sales reported by chartered surveyors was largely unchanged in the second quarter at 68, down from 69 in the first quarter. Adjustments for seasonal influences suggest sales were relatively weak for the time of year. Sales have been affected by the impact of the MidTerm Review, so it is presently difficult to interpret the underlying state of activity.

Agricultural land sales Number of reported land sales, England and Wales only

350 300 250 200 150

Total area traded picked up in the latest quarter, to 3,000 hectares, and is only slightly below that of the same period last year. Adjusting for seasonal influences, moreover, area traded was unchanged on the previous quarter.

100 50 0 95

96

97

98

Raw sales data

99

00

01

Seasonally adjusted

02

03

RICS farmland market survey Second quarter 2003

Demand The ongoing deterioration in demand for farmland eased back somewhat in the latest quarter according to chartered surveyors. In Q2, 21% more respondents reported a fall in demand than a rise for farmland, up from a net 33% reporting a fall in Q1, though compares with the net 3% reporting a rise in Q2 2002.

Change in farmland demand over the past year % Balance

10 0 -10

For residential farms, demand continued to improve though the rate of growth slowed. In Q2, 12% more chartered surveyors reported a rise in demand than a fall, down from 15% in Q1. The rise is furthermore well down on the net 51% reporting an increase for the same quarter last year, and mirrors a steady slowdown in the wider housing market.

-20 -30 -40 -50 99

00

01

02

03

Availability Farmland availability declined at a slower rate in the second quarter, though the drop was still significant. A net 38% of chartered surveyors reported a decline in the supply of land coming on to market, moderately below the net 47% reporting a fall of Q1. This contrasts with rising availability in mid-2002.

Change in farmland availability over the past year % Balance

30 20 10 0 -10

For residential farms, falling availability in Q2 was scaled back in the latest quarter. A net 22% of chartered surveyors reported a fall in supply in Q2, less than the net 36% reporting a decline in Q1. The weak availability of farmland in Q2 continued to reflect uncertainty over the outcome of CAP reform.

-20 -30 -40 -50 -60 99

00

01

02

03

Expected prices The pessimistic outlook for farmland prices receded in the latest quarter. In Q2, a net 30% of chartered surveyors expect farmland prices to fall over the next 12 months, improving from 62% expecting lower prices in Q1. Recent announcements concerning the Mid Term Review may have helped to clear some of the uncertainty affecting the market, thus aiding a pick -up in expectations.

Expected change in prices over the next year % Balance

0 -10 -20 -30 -40 -50

For residential farms, confidence in prices rebounded in Q2. A net 16% of surveyors expect prices to rise over the next year, compared to the net 15% expecting a decline when asked in Q1. Nevertheless, price expectations for this category have cooled since the start of 2002, reflecting the slowdown in the housing market.

-60 -70 -80 -90 99

00

01

02

03

3

4

RICS farmland market survey Second quarter 2003

Regional farmland markets North West and North East Surveyors reported an improvement in demand conditions in the latest period. For Q2, a net 17% of respondents reported increased sales activity, in contrast to the net 30% reporting declining demand in Q1. The increase is the first recorded since the beginning of 2002. Market conditions for residential farms also strengthened. For Q2, a net 67% of surveyors reported increased demand, up from 40% in Q1 and the largest reported rise since Q4 2000. Farmland availability declined at a similar pace to the first quarter. A net 33% of surveyors reported lower farmland availability in Q2, down slightly from 30% in Q1. Surveyors reported no change in availability of residential farms after a decline in Q1.

Change in demand / availability over the past year % Balance

60 40 20 0 -20 -40 -60 -80 -100 99

00

01

Demand

02

03

Availability

Yorkshire and Humberside Demand for farmland continued to deteriorate in the latest quarter, though at a slower pace than in Q1. For Q2, a net 50% of chartered surveyors reported declining farmland demand, up from the net 76% reporting a fall in Q1. The trend in activity appears to have worsened since the end of 2002. Demand for residential farms was flat in the second quarter, and appears to have general ly levelled out since the third quarter last year. Farmland availability tumbled in the second quarter with all respondents reporting lower supply, well down on the net 14% reporting a fall for Q1. For residential farms, a net 50% reported a decline in availability, down modestly from the net 44% reporting a fall for Q1, and in contrast to the net 43% reporting a rise for Q2 last year.

Farmland prices, four quarter average £ per hectare

9000

8000

7000

6000

5000

No sales data available for Q2, 2003

4000 99

00

01

02

03

02

03

Wales Surveyors reported a small rise in farmland demand in the second quarter. A net 7% of respondents reported increased activity in Q2, up from a net 6% reporting a fall in Q1. Demand conditions remain weaker than that seen for much of 2002. For residential farms by contrast, demand remains strong, with a net 71% of surveyors reporting higher activity in Q2, up slightly from 69% in Q1. Availability of farmland was flat in the second quarter, following a sharp fall in Q1. Compared with 2001/early 2002, however, supply conditions have been relatively better over the last year. For residential farms, availability turned upwards, a net 14% of surveyors noting increased supply, up from the net 17% reporting a fall in Q1.

Farmland prices, four quarter average £ per hectare

7000 6500 6000 5500 5000 4500 4000 99

00

01

RICS farmland market survey Second quarter 2003

East Midlands Market conditions for farmland remain weak. In the second quarter, a net 43% of surveyors reported falling demand for farmland, though improved slightly on the net 69% reporting a fall in Q1. Conditions remain notably weaker than the same period last year. Demand for residential farms was flat in Q2, as conditions weakened for a second successive quarter. Farmland availability declined at a slower pace though is still seeing a precipitous drop. In Q2, a net 50% of surveyors reported falling supply of farmland, improving from a net 67% reporting a fall in Q1. For residential farms a net 36% of respondents reported lower availability in Q2 compared to 29% in Q1.

Farmland prices, four quarter average £ per hectare

10000 9000 8000 7000 6000 5000 4000 99

00

01

02

03

02

03

West Midlands Demand for farmland showed a modest rise in Q2. A net 7% of chartered surveyors reported increased activity, halting three quarters of declines, and compares to a similar rise in Q2 last year. Demand for residential farms showed renewed strength after Q1’s slowdown, a net 50% of respondents reporting an increase in this category. Farmland availability declined at a slower rate in the second quarter. In Q2, 36% more surveyors reported a fall in supply than a rise, up from a negative 66% in Q1, though the trend in supply is still weaker than during 2002. Availability of residential farms recorded no change after a marked drop in Q1, though compares with rising supply in the same quarter last year.

Farmland Prices, four quarter average £ per hectare

11000 10000 9000 8000 7000 6000 5000 4000 99

00

01

Scotland Surveyors reported a smaller rise in activity in the latest quarter. For Q2, a net 6% of respondents reported increased demand, down from the net 23% in Q1. Market activity has generally tailed off from last year. For residential farms, however, demand strengthened, with a net 44% of respondents noting an increase, up from 38% in Q1. Supply of farmland contracted at a faster pace in the latest quarter. In Q2, 50% more chartered surveyors reported a fall in availability than a rise, down from a negative 33% in Q1. For residential farms, supply contracted at a slightly slower pace, a net 31% of respondents reported lower availability, up from a negative 38% in Q1.

Change in demand / availability over the past year % Balance

80 60 40 20 0 -20 -40 -60 -80 -100 99

00

01

Demand

02

Availability

03

5

6

RICS farmland market survey Second quarter 2003

South West Demand fell at a faster pace in the latest quarter. In Q2, 47% more surveyors reported a decline in activity than a rise, down from a net 19% reporting a decline in Q1. Demand has steadily deteriorated since Q1 2002. Demand for residential farms picked up following a small fall in Q1. A net 5% of respondents reporting higher activity in Q2 but is much weaker than the rises reported a year ago. Supply continued to fall in the second quarter. A net 21% of surveyors reported a fall in availability, up from a net 52% reporting a fall in Q1. For residential farms a net 28% of respondents reported declining availability in Q2, down from 21% in Q1. This compares with strengthening supply in 2002.

Farmland prices, four quarter average £ per hectare

8500 8000 7500 7000 6500 6000 5500 99

00

01

02

03

02

03

02

03

Eastern Demand fell at a similar pace to the previous quarter. In Q2, 53% more chartered surveyors reported a decline in farmland market activity, slightly lower than in Q1. The figure is moreover, well below that of Q2 last year. Activity also deteriorated slightly further for the residential sector, a net 35% of respondents reporting lower demand, and contrasts with modest increases for the same quarter last year. Farmland availability deteriorated significantly in the latest quarter. In Q2, 71% more chartered surveyors reported lower availability than a rise, down from a negative 48% in Q1. For residential farms availability declined at a slightly slower pace, a net 59% reporting a fall from a negative 72% in Q2.

Farmland prices, four quarter average £ per hectare

8500 8000 7500 7000 6500 6000 5500 5000 99

00

01

South East Demand In Q2, construction remains weak workloads in Q2 but rose was less at asosimilar than inpace Q1. In to Q2, 23% more surveyors reported of a fall in demand for that reported in Q1. A balance 21% of surveyors farmland a riinse, better than 45% reporting a fall reported than a rise workloads in the Q2,net compared with 22% in Q1, though remained weaker than the same quarter last in Q1. Private housebuilding posted another firm rise. year. Forhousing residential farms, activity fell second for the first time since Public activity rose for the quarter in a the introduced. A net 29%Other reporting lower row,question having was fallen throughout 2001. public work demand, from a 12% reporting a rise in Q1.

rose, up strongly in the first two quarters of the year. Private industrial work fell for the third quarter in a row, Availability of residential farms fell at a slower rate in the while private commercial building workloads rose. second quarter, with a net 27% reporting a decline in supply Skills shortages belowcompare year ago up from a negativeeased 33% inand Q1. were The figures with a levels. Confidence remains upbeat and surveyorsfar ms, more limited decline in supply in 2002. For residential expect workloads employment rise over the next 12% more surveyorsand reported a decline to in availability than a 3 and month periods. rise, up12 from a negative 40% in Q1.

Farmland prices, four quarter average £ per hectare

9000 8500 8000 7500 7000 6500 6000 99

00

01

RICS farmland market survey Second quarter 2003

7

Market data— opinion based Let land rents & yields ARABLE RENTS, £ per acre ------------ AHA 86 ------------

PASTURE RENTS, £ per acre

----------- AHA 95 -----------

------------ AHA 86 ------------

----------- AHA 95 -----------

Average

Q2 2003

Min

Max

Average

Min

Max

Average

Min

Max

Average

Min

Max

Average

Yield %

Eastern

48

60

50

68

90

78

10

50

35

15

60

38

4.1

East Midlands

45

63

51

65

85

80

35

50

45

35

65

58

3.8

South East

40

60

50

50

85

68

15

45

35

20

60

40

3.4

South West

38

70

50

50

90

75

30

70

43

35

90

60

Wales

30

70

51

60

150

83

30

60

40

48

125

70

West Midlands

48

70

58

65

90

80

30

65

50

45

85

60

ENGLAND & WALES

53

76

41

Rental figures refer to the typical rent paid for let land for all grades, expressed as a median of all responses of 5 or more. No data published for North West, North East and Yorkshire & Humberside due to low response level. Yields data refer to the typical yield reflected in any let land sales. England and Wales figure is the weighted average.

Farmland prices Prices, £ per acre Q2 2003

Min

ARABLE LAND Max Average

Min

PASTURE Max Average

Eastern

2150

2750

2250

1200

2500

1825

East Midlands

2100

3000

2275

1700

3100

2000

South East

1900

3000

2200

1000

4000

1825

South West

1250

2700

2200

1600

2500

1900

Wales

2000

4000

2700

2000

3000

2350

West Midlands

2100

3000

2400

1150

3100

2000

Scotland

1100

2350

1600

650

1350

ENGLAND & WALES

2376

950 1933

Figures refer to the typical prices paid, in £ per acre for bare land. Regional figures expressed as a median of all responses of 5 or more. No data published for North West, North East and Yorkshire & Humberside due to low response level. England and Wales figure is the weighted average.

Farmland purchasers by type Q2 2003

Purchaser Background % Individual

Agricultural

Non-

Institutional

Farmer

business

Farmer

Investor

Eastern

38

11

37

13

1

East Midlands North East & North West

38 26

1 2

53 32

1 3

7 17

Scotland South East

60 29

5 4

32 56

2 6

1 6

South West Wales

38 53

5 5

51 39

0 0

6 3

West Midlands Y & H

51 85

6 0

41 15

1 0

0 0

Overall

43

5

44

3

4

Percentage of Sales

Figures for each category based upon the average response of surveyors responding.

Other

56

3.6

8

RICS farmland market survey Second quarter 2003

Chartered Surveyor market comments National

Eastern

J A N Laing Esq FRICS, Strutt & Parker Despite the uncertainty caused by the MTR, farms and estates have sold well th is spring and summer at prices above expectation.

Bedford D J Jones Esq MRICS FAAV, Robinson & Hall Contrary to popular belief MTR is not stalling the land market. There remain plenty of buyers willing to pay as much as in recent years. Buyers, sellers, agents and solicitors are being sensible and pragmatic with regards to MTR clauses.

East Midlands Ashbourne N R S Hansen Esq MRICS FAAV, Bagshaws Market for all types of rural property firm. Bare land prices very keen despite uncertainties over MTR. Bourne S G Knipe Esq BSc FRICS FAAV, Stephen Knipe & Co Uncertainty re MTR continues to be the dominant feature. Horncastle R L H Bell Esq BSc FRICS, Robert Bell & Co The MTR has made the market for sales and letting extremely fragile. Several agreed sales are on hold until the outcome is more certain. Lincoln William Price Esq, FPD Savills MTR has effectively stopped the market, especially for commercial land. Going forward, a guaranteed decoupled income should see prices harden, especially for residential farms, but supply to remain tight. Robin M Battle FRICS, James Martin & Co MTR uncertainty has much reduced market activity. Market Harborough R L St B Vigne Esq FRICS, Strutt & Parker Lack of supply ensuring the market remains steady. Competition has seen a marginal rise in avera ge values. Improved commodity prices and exchange rates have created better confidence. Melton Mowbray D M W Shouler Esq FRICS FAAV, Shouler & Son It's extremely difficult to comment with any accuracy on the land market. Very few sales, those which have seem to have seen much better results than expected. Sleaford John F Pygott Esq MRICS, Pygott & Crone The MTR has not ground the market to a halt as was predicted. Has enabled selective buyers to lay the foundations for some sound purchases.

Cambridge J D E Bryant Esq MRICS, Bidwells The much talked about MTR has undoubtedly held some land from coming to the market but is not the principal reason for the shortage of land in the market. Colchester Nick Harper Esq MRICS FAAV, Fenn Wright Uncertainty over IACS entitlement due to MTR is delaying existing sales from completing. Buyers and sellers are holding back. Uncertainty over house values has led to some non farming buyers withdrawing or holding back. Great Dunmow T L Whirledge Esq FRICS FAAV, Whirledge & Nott Much uncertainty has been created by MTR resulting in almost no land being placed on the market for sale. The fine print in the minister's agreement will determine whether more land will be available. Hitchin C J Perks Esq, Warmingtons The market has generally been stalled since the publication of the MTR. This has created widespread uncertainty amongst purchasers as to their ability to secure future entitlements. There are however still limited signs of activity generally in situations where other criteria govern the purchase, or the purchaser was prepared to take a risk. Huntingdon D H Sinfield Esq FRICS FAAV, Alexanders Ongoing thin market with litle sign of any substantial bloc ks coming to the market in this area. Ipswich William Gittus Esq MRICS, Bidwells Sales and purchases quite possible despite MTR providing both parties are sensible and willing. Shortage of supply and residential demand still important influences.

Ipswich Chris J Leney Esq MRICS FAAV, Robinson & Hall MTR has had stagnating effect on market, although some land still selling. Prices continue to be dependant on residential element, interest from neighbours and quality of land. London buyers fewer in number, less confident. Ipswich G P W Allen MRICS FAAV, Strutt & Parker Farms and farmland continue to sell. A very low supply is helping but demand still there. Sales taking longer but there has been very little effect on prices achieved. Residential farms generally moving well. Kings Langley E H S Briggs Esq MRICS FAAV, Faulkners The MTR proposals have affected the commercial land market in terms of the uncertainty created. Notwithstanding this, many nonfarmer buyers are purchasing for non-agricultural reasons and these concerns are not relevant and appear unimportant. King's Lynn R S Lansdell Esq FRICS FAAV, Robin Lansdell & Co Very little land on the market at the beginning of the quarter; more has been brought on in the last month but little evidence of any sales achieved. MTR creating uncertainty and hesitation. Norwich D Hooper Esq MA FRICS FAAV, Brown & Co There is almost no property on the market and no deals done this quarter. MTR has certainly put some people off selling this year. Lots of interest in those few farms currently available. C M Miles Esq MRICS, FPD Savills MTR proposals causing severe problems and uncertainty with many potential vendors holding back. That said, signs of more properties coming to the market and we are concluding a number of private deals. Peterborough Robin W Clarke Esq MRICS FAAV, Smiths Gore The MTR of the CAP has brought the farmland market to a virtual standstill. The recent Review announcement may lead to latent sales of the las t six months being realised.

Rochford M E Hughes Esq BSc MRICS FAAV FNAEA, Whirledge & Nott Pasture/amenity land is being bought up by residential neighbours to avoid gypsies buying it. Also being bought by those who think it will get planning permission in the future. St Albans Mrs Rachel Cubitt , Strutt & Parker MTR has put a hold on any truly agricultural land sales or lettings. Some 'amenity' land sti ll being sold with farmhouses. Wisbech J R Major Esq FRICS, Brown & Co MTR has halted the market. More deals expected to be contracted between June and October.

North West Kendal B R Rycroft Esq FRICS FAAV, Carter Jonas Land coming to the market remains slow - CAP/MTR discussions resulting in fewer decisions being made as outcome of MTR awaited. Macclesfield A N Lane Esq FRICS FAAV, Frank R Marshall & Co Most agents and vendors have been surprised by prices achieved for sales of bare land this spring. Nonfarming individuals have been prominent as purchasers - not bothered by the uncertainties of the MTR Macclesfield John Seed Esq, The Brown Rural Partnership Prices in the sales market being maintained at high levels due to shortage of supply contra sting with the letting market where increased supply has led to falling prices. Preston Adam Pickervance Esq MRICS, SHM Smith Hodgkinson Scarcity = demand = price increase.

Scotland Banchory D Strang Steel Esq, Strutt & Parker Very little on the market so difficult to establish trends. Dumfries C W Grieve Esq FRICS, G M Thomson & Co Once again lack of supply is the main factor in maintaining values, the exception being the poor dairy performance has not resulted in

RICS farmland market survey Second quarter 2003

expected falls in values over past 12 months. Any increase in supply is dependant on decoupling proposals being confirmed. The tenanted sector in Scotland is quiet until the new legislation is digested and understood. Edinburgh C L Dudgeon Esq FRICS, FP D Savills Significant drop in number of farmland acres for sale due to uncertainty over MTR and future of subsidies. In addition, with a better year for farmers in prospect, there would have been fewer units to be offered for sale this year in any event. Edinburgh Michael Jones Esq, Knight Frank The MTR has had a significant impact on the market. The uncertainty surrounding its implementation and the knock- on effect on future entitlements has caused the market to largely 'dry up' as potential sellers adopt a 'wait and see' attitude. Edinburgh Christopher Hall Esq MRICS, Langley Taylor Low interest rates continue to prop up the farmland market and demand remains strong due to lack of supply. MTR impacting on supply and only around 14,000 farmland acres publicly advertised in the first five months of 2003. Market should remain good for those who sell this year. Edinburgh Andre w Smith Esq MRICS, Strutt & Parker As there is still uncertainty over the MTR proposals, many people are concerned about buying a farm. However, for all those farms that have come to the market there has been a ready market with no shortage of interested parties prepared to bid at the closing date Fochabers Jamie Watson Esq MRICS, Smiths Gore MTR has caused uncertainty but not halted the market. Galashiels H A Lukas Esq MRICS, John Sale & Co Very little available - MTR very significant. Kilmarnock T H P Donald Esq FRICS MRAC, Donalds Chartered Surveyors First the prospect and now the reality of the tenant's right to buy and other changes under AHA 2003

has killed the letting market stone dead, except for seasonal lets, which are essentially unaffected. Uncertainties over CAP MTR have had the same effect on the capital market, except for residential farms, demand for which continues to be insatiable . Perth Bruce Osborne Esq FRICS, Bidwells MTR has put many potential sales on hold. Stirling Gerald McLaughlin Esq FRICS, DMH Baird Lumsden We have dealt with the sale of smaller farms recently in which the private residential market has affected value and percentage of private interest. Had the farms been bigger this would have not been so apparent.

South East Ashford C Hosmer Esq FRICS FAAV, Hobbs Parker Short supply continues to underpin the land market, with a continuing high level of enquiry from no nfarmer prospective purchasers. When MTR is clarified we can get to grips with problem points and resolve them to best advanta ge. Banbury Simon Harris Esq FRICS, Berry Morris Shortage of supply has underpinned price in an uncertain market in the light of MTR. Banbury C E A Haselwood Esq FRICS FAAV, Clayson Haselwood, Fisher German Demand still firm for small/ medium farms from non-farming interest. Demand for bare land thin. Relief that there is no rush of supply of bare land. Banbury Richard Binning Esq MRICS, FPD Savills Good supply of farms has come to the market through us in spite of the concerns over MTR. Purchasers not too concerned about MTR, in the knowledge that sales are happening even in the uncertainty. Canterbury Ralph Crathorne Esq FRICS Strutt & Parker Hopefully, the clarification on many of the aspects of the MTR last week will re-awaken the market in Ke nt. However, as we are still predominantly amenity and

residentially driven, activity has continued in the meantime and we hope will continue to do so whilst workable subsidy transfer mechanisms are established. Challock R P Thomas Esq MRICS FAAV, BTF Lister A worrying stagnant period with few new instructions anticipated until MTR is put to bed one way or the other. The positive news from the south east is the better lamb price ove r the spring and cereals looking healthier with the weakening pound. Dorking Stuart M Walker Esq BSc MRICS FAAV, White & Sons Lack of supply of land in Surrey area holding prices up. Continued strong interest from equestrian and amenity buyers for smaller blocks and from investors still keen on larger blocks. Difficult to predict market post MTR. Faringdon Andrew Brown Esq FRI CS FAAV, Marriotts Farms with a strong residential element are still selling but competition is lower than last year. Buyers have more choice at present but not enough to cause any significant price falls. Haywards Heath A J Sadler Esq FRICS FAAV, Monkhouse & Bannisters Short supply has created strong demand for significant blocks of land with or without buildings. Heathf ield A Samuel Esq MSc MRICS, Charles Clark & Co Still evidence of a lack of commitment to sale process by vendors and purchasers alike due to uncertainties arising from likely implications of MTR. The situation seems to have confused agents too! Horsham J A Farquhar Esq FRICS FAAV, Henry Smith & Son MTR is causing uncertainty making sales to farmers very difficult. Nonfarmers still buying.

London M J McAndrew Esq MRICS, Strutt & Parker Vendors and purchasers have found ways of mitigating the risks ca used by the MTR of CAP and we have experienced a buoyant first six months with guide prices regularly being exceeded.

9

Maidstone P H Harland Esq FRICS, Cluttons Uncertainty over MTR - likely to continue into early 2004. Pulborough R M Parkes Esq MRICS FAAV, Monkhouse and Bannisters Demand still strong for land in the south east from mainly nonfarming investors. Steyning R B Allan Esq MRICS FAAV, H J Burt & Son Demand for land/farm purchases more selective in a market which has changed from being a seller's to a buyer's. Sussex prices affected by general toughening of residential market with decrease in prices since last year. Sales and rentals taking longer to finalise. Thame Robert Serjeant Esq MRICS, Dreweatt Neate Review of CAP MTR is having an effect nationally, but this is not being repeated in this locality except for large commercial units of which very few are available. The residential values are still holding up well despite the general downturn in residential property. Wantage J A Sayers Esq FRICS FAAV, Adkin Rural & Commercial The market for small residential farms has remained strong together with the demand for amenity land. The issues surrounding CAP reform have, however, restricted the sale of commercial farms in the locality since the start of the year as such holdings have not been offered to the market.

South West Burnham-on -Sea Jeremy B Bell Esq FRICS FAAV IRRV, J H Palmer & Sons Smaller acreages becoming increasingly demanded as the equestrian purchasers increase and low interest rates are making land a more profitable investment. Chippenham C J Harding Esq BSc FRICS FAAV, Dreweatt Neate Lack of farms and land coming to the market due to the uncertainties of MTR. Capital taxation system is still favourable to the o wnership of farms and land. Pasture land more difficult to sell; however, there are 'hot spots' for sales of pasture as well as arable land.

10

RICS farmland market survey Second quarter 2003

Exeter Alex Rew Esq MRICS FAAV, Stags Lack of supply continues leading to high interest and values on those farms/blocks of land coming to the market. Exeter P H Thomas Esq BSc MRICS, Stratton & Holborow We have sold a let estate - but in each case the farm and land was sold to the tenant. Exeter R Thomas Esq FRICS FAAV, Strutt & Parker A shortage of supply and static farmland prices has resulted in a stable farmland market. Gloucester M R Peters Esq FRICS FAAV, BK A jittery time - but we have done deals on four large farms, all to nonfarming buyers or agri -business. A view is being taken on MTR - with common sense prevail ing (thankfully!). The residential market is still there - just - but at more realistic prices. The pure commercial farms are falling in value. Still huge demand for small areas close to villages and towns. Honiton S A Cooper Esq FRICS, Stags Farmland market propped up by non-farming buyers. Strong demand for 1-30 acre blocks of pasture and woodland. Very few good commercial farms or land coming on to test the market. Marlborough Richard Nocton Esq FRICS FAAV, Woolley & Wallis The MTR is the perfect excuse for prevaricating over decisions to market and/or to exchange contracts. Where this can be set to one side, competition and prices are good. Moreton- in- Marsh J S Feilding Esq FRICS, Strutt & Parker The demand for most types of farmland remains fairly strong, despite the MTR issues, and residential purchasers still dominate the market. Sturminster Newton C N Matthews EsqBSc FRICS FAAV, Symonds & Sampson The surprising shortage of property is keeping the market strong despite a shortage of buyers.

Taunton D H Hebditch Esq FRICS FAAV, Humberts Despite the difficulties brought about by the MTR the shortage of property has generated a very strong demand. Well equipped holdings or residential units have sold well. Tavistock D R Kivell Esq FRICS FAAV, Kivells Buyers are becoming frustrated, awaiting the outcome of the MTR. More deals expected this autumn. Truro P B Fletcher Esq FRICS FAAV ACIArb, Stratton & Holborow MTR of the CAP seems to be causing vendors to 'hold on' and purchasers to be exercising extreme caution (farmer to farmer transactions). Very few deals being done currently. Wells Alastair G Martin Esq FRICS, Dreweatt Neate MTR has brought everything to a grinding halt. No-one knows what to do and so nothing is happening.

Wales BangorTim Barter Esq, Carter Jonas Very little land on the market for sale. Individual sales tend to have unusual factors, and are small areas not indicating general trends. The seasonal letting market suffered from concerns over the single farm payment issue and CAP reform. Builth Wells T I Parry Esq FRICS, Brightwells Demand for farms and land in the mid Wales region remains stro ng mainly driven by residential buyers. But bare land sales have also shown an increase in values in the first half of 2003. Following a number of successful sales this spring, more land is coming onto the market. Carmarthen James Andrews Esq BSc FRICS, Llywelyn Humphreys There is a lack of any commercial farms on the market due to the uncertainty of the MTR. The few farms tha t have been offered have sold in excess of the asking price. Cowbridge G Lloyd Esq FRICS, Watts & Morgan CAP reform has greatly affected demand and interest by genuine individual farmers. Demand for small parcels up to say 15 acres has remained high making prices in excess of £5,000/acre. Residential market has still continued to rise

especially for barn conversions, undeveloped up to £400,000 and those converted up to £1M.

and we cannot see values decreasing whilst interest rates are low and EU support available.

Haverfordwest Edward Perkins Esq OBE FRICS FAAV ACIArb, Edward H Perkins The amount of farms and land coming for sale is so small that it is not possible to give accurate returns.

Shrewsbury M J Laws Esq FRICS, Carter Jonas MTR has had the main effect - less arable units into the spring market. Still a shortage of residential farms. Shropshire continues to be popular for buyers from the south east.

Lampeter Andrew J Morgan Esq FRICS FSVA FAAV, Morgan & Davies Quality residential farms still selling well. Commercial farms if well equipped and in the right neighbourhood still sell well. Farming money is harder to get at for the expanding farmer.

Worcester J A Turner Esq FRICS, DTZ Debenham Thorpe The CAP MTR proposals have impacted on the availability of farms and demand is also reflected by this. We anticipate more land coming to the market when the outcome is known.

Pembroke P A Owen Esq, Owen & Owen CAP review has resulted in a marked decline in both availability and demand where residential element is less than 50%.

Yorkshire and Humberside

West Midlands

Hull Ralph Ward Esq FRICS FAAV, Frank Hill & Son CAP MTR has suspended sales of arable land until details available.

Craven Arms P B Segrott Esq FRICS MRAC, Balfours Little farmland coming onto the market except where there is a residential value which can be sold with a few acres to be capitalised. Evesham R G R Mumford Esq FRICS, Timothy Lea & Griffiths Small parcels of land are making up to £6,000/acre. Land leaving farming, used for leisure and horses. Kington G R Wall Esq MRICS FAAV MIAgrM, McCartneys MTR has made many landowners concerned over letting o r selling their land this year. Once the MTR has been agreed this will allow more land on the market to rent and buy. Ross-o n-Wye Nigel Morris Esq FRICS NDA FAAV MRAC, Morris Bricknell From a farming perspective, outcome of the MTR has resulted in few transactions being entered into. From a residential view cooling of genuine interest and more aware of values - more protracte d negotiations. R G Williams Esq FRICS FAAV ACIArb, Williams Parry Richards Very small number of farms and blocks of land on the market undoubtedly due to the MTR uncertainties. Demand is still good

Brigg Giles Johnston Esq, DDM Agriculture MTR - stagnated market.

York A J Fallows Esq MRICS FAAV, Carter Jonas The last quarter has reflected a stagnant market although two farms marketed created good interest. The agreement on CAP reform is welcome but, as always, the detail is awaited. The trade in entitlements will create a two tier market. A W Black Esq MRICS, FPD Savills MTR concerns have effectively put a hold on the trading of land in the short term. Unlikely that much volume will come forward this year although there are still willing purchasers seeking to move forwards when MTR is sorted out.

RICS farmland market survey Second quarter 2003

11

Contributor details NATIONAL J A N Laing FRICS Strutt & Parker 0171 318 5177(0207)

T L Whirledge FRICS FAAV Whirledge & Nott 01245 231123

EAST MIDLANDS

E H S Briggs MRICS FAAV Faulkners 01923 264264

C E AHaselwood FRICS FAAV Clayson Haselwood, Fi sher German 01295 271555

Robin W Clarke MRICS FAAV Smiths Gore 01733 567231

R L H Bell BSc FRICS Robert Bell & Co 01507 522222

R S Lansdell FRICS FAAV Robin Lansdell & Co 01553 631100

N R S Hansen MRICS FAAV Bagshaws 01335 342201

D J Jones MRICS FAAV Robinson & Hall 01234 352201

Stephen J King FRICS King West 01858 435970

D Hooper MA FRICS FAAV Brown & Co 01603 629871

T HWhite MA FRICS FAAV Brown & Co 01775 722321

T F Fagan MRICS Strutt & Parker 01245 258201

John FPygott MRICS Pygott & Cro ne 01529 414555

J R Major FRICS Brown & Co 01945 464747

John AGale MRICS J H Walter 01522 526526

B L Hawkins FRICS FAAV 01366 387180

Robin MBattle FRICS James Martin & Co 01522 510234 M W Shouler FRICS FAAV Shouler & Son 01664 560181 GeoffreyBishop MRICS FAAV Escritt & Barrell 01476 565371 John Batterbee MRICS Frank R Marshall & Co 01298 23038 A Granger FRICS FAAV Andrew Granger & Co Ltd 01858 565535 S G Knipe BSc FRICS FAAV Stephen Knipe & Co 01778 421900 WilliamPrice BSc(Hons) MRICS FPD Savills 01522 551100 Simon Harris FRICS Berry Morris 01295 273555 R L St B Vigne FRICS Strutt & Parker 01858 433123 TrevorWells MRICS FAAV Fisher German 01858 410200 EASTERN J Harris FRICS FAAV Irelands 01603 250808

T E J Jones MRICS Carter Jonas 01223 368771 WilliamGittus MRICS Bidwells 01473 611644 C M Miles MRICS FPD Savills 01603 229233 D H Sinfield FRICS FAAV Alexanders 01480 432220 D J Jones MRICS FAAV Robinson & Hall 01234 352201 Mrs Rachel Cubitt MRICS Strutt & Parker 01727 840285 D J Jones MRICS FAAV Robinson & Hall 01234 352201 Nigel Nott Whirledge & Nott 01787 472118 E H S Briggs MRICS FAAV Faulkners 01923 264264

J E Rhind BSc FRICS Aberdeen & Northern (Estates) Limited 01467 623800 AndrewSmith MRICS Strutt & Parker 0131 226 2500 C L Dudgeon FRICS FPD Savills 0131 247 3700 A N Crow FRICS John Clegg & Co 0131 2298800 ChristopherHall MRICS Langley Taylor 0131 220 0576 A F Nisbet FRICS FBR Ltd 01573 224381 C W Grieve FRICS G M Thomson & Co 01387 254424 Bruce Osborne FRICS Bidwells 01738 630666 Michael Jones MRICS Knight Frank 01312 258171 T H P Donald FRICS MRAC Donalds Chartered Surveyors 01560 600581 Mark Mitchell MRICS Bell Ingram Rural 01738 621121 S H McCoshim MRICS McCoshim & Co 01890 860699 D Strang Steel MRICS Strutt & Parker 01330 824888 H A Lukas MRICS John Sale & Co 01896 754842 Gerald McLaughlin FRICS DMH Baird Lumsden 0131 4776000 SOUTH EAST

M E Hughes BSc MRICS FAAV FNAEA Whirledge & Nott 01702 541359

C Hosmer FRICS FAAV Hobbs Parker 01233 502222

NORTH EAST

Chris Storey MRICS Spencer Bird 01787 311140

Ms Linda Hall John Sale & Partners 01668 281611

C J Perks Warmingtons FRICS FAAV 01462 768814

John Seed MA FRICS FAAV The Brown Rural Partne rship 01625 434696

Chris J Leney MRICS FAAV Robinson & Hall 01473 831531

NORTH WEST

Nick HarperMRICS FAAV Fenn Wright

JamieWatson MRICS Smiths Gore 01343 823002

A J Sadler FRICS FAAV Monkhouse & Bannisters 01444 412402

A J Fallows MRICS FAAV Carter Jonas 01904 558212

J D E Bryant MRICS Bidwells 01223 559509

Niall Macalister Hall MRICS Smiths Gore 0131 555 1200

C J Perks FRICS FAAV Warmingtons 01462 768814

G P W Allen MRICS FAAV Strutt & Parker 01473 214841

T J Jackson FRICS FAAV Brown & Co 01328 856888

SCOTLAND

Adam Pickervance MRICS SHM Smith Hodgkinson 01772 555403 B R Rycroft FRICS FAAV Carter Jonas 01539 722592 A N Lane FRICS FAAV Frank R Marshall & Co 01625 86 1122

Martin Allen MRICS FAAV Charles Elgar & Sons 01227 720557 Andrew BrownFRICS FAAV Marriotts 01367 242422 J P Stratford FRICS FAAV Stratford's 01233 640200 C E AHaselwood FRICS FAAV Clayson Haselwood, Fisher German 01295 271555 ReubenDiffey BSc(Hons) MRICS Butler Sherborn 01993 822325 Ralph Crathorne FRICS Strutt & Parker 01227 451123 M P Lowry FRICS FAAV Dreweatt Neate 01962 858585

Creasey Biles & King 01983 527744 R M Parkes MRICS FAAV Monkhouse and Bannisters 01798 872081 J Youatt MRICS Strutt & Parker 01273 475411 Stephen R Power MRICS MCIOB Simmons & Sons 01491 571111

J A N Laing FRICS Strutt & Parker 0171 318 5177(0207) Jeremy B Bell FRICS FAAV IRRV J H Palmer & Sons 01278 782326 Justin Lowe FRICS FAAV Greenslade Taylor Hunt 01935 423474

J J Morris 01437 760440 Tony Evans MRICS FAAV Morris Marshall & Poole 01686 625900 R R Williams BSc FRICS McCartneys 01497 820778 WEST MIDLANDS

E A Venner FRICS Husseys 01392 250441

J A Turner FRICS DTZ Debenham Thorpe 01432 276202

C Wreford-Brown FRICS FAAV Luscombe Maye Hands Hughes 01364 73651

D G FBanks FRICS FAAV MRAC G Herbert Banks 01299 896968

D H Hebditch FRICS FAAV Humberts 01823 331234

M M VTaylor BSc FRICS FAAV Barbers 01630 652314

S A CooperFRICS Stags 01404 45885

M R Peters FRICS FAAV BK 01452 880000

P H Thomas BSc MRICS Stratton & Holborow 01392 278466

M FogdenMRICS Smiths Gore 01772 663124

Alastair G Martin FRICS Dreweatt Neate 01749 677667

R GWilliams FRICS FAAV ACIArb Williams Parry Richards 01989 567233

Stuart M Walker BSc MRICS FAAV White & Sons 01306 743344

Ian Hepburn FRICS Strutt & Pa rker Research 01722 328741

R G R Mumford FRICS Timothy Lea & Griffiths 01386 765700

J A Farquhar FRICS FAAV Henry Smith & Son 01403 253271

S Hext MRICS FAAV Luscombe Maye 01548 857474

Richard Binning MRICS FPD Savills 01295 228000

M J McAndrew MRICS Strutt & Parker 020 7318 5171

C N Matthews BSc FRICS FAAV Symonds & Sampson 01258 472244

J S Feilding FRICS Strutt & Parker 01608 650502

J A Sayers FRICS FAAV Adkin Rural & Commercial 01235 862888

WALES

N R S Hansen MRICS FAAV Bagshaws 01335 342201

Robert Serjeant MRICS Dreweatt Neate 01844 269999 M A Charter BSc MRICS FAAV Carter Jonas 01865 511444 Jim Pace MRICS G W Finn & Sons 01227 710200 J A N Laing FRICS Strutt & Pa rker 0171 318 5177(0207) R P Thomas MRICS FAAV BTF Lister 01233 740077

Ian S V Judd FRICS FAAV Ian Judd & Partners 01489 896422 John Twentyman FRICS FAAV Woolley & Wallis 01794 512129 P H Harland FRICS Cluttons 01622 756000 R B Allan MRICS FAAV H J Burt & Son 01903 879488 A Samuel MSc MRICS Charles Clark & Co 01435 864455 SOUTH WEST Alex Rew MRICS FAAV Stags 01392 255202 J S Feilding FRICS Strutt & Parker 01608 650502 M R Peters FRICS FAAV BK 01452 880000 D R Kivell FRICS FAAV Kivells 01822 614262 David Cross FPD Savills 01722 426813 Richard Nocton FRICS FAAV Woolley & Wallis 01672 515252 R Thomas FRICS FAAV Strutt & Parker 01392 2 15631 P B Fletcher FRICS FAAV ACIArb Stratton & Holborow 01872 274646 C J Harding BSc FRICS FAAV Dreweatt Neate

M J Laws FRICS Carter Jonas 01939 210440 P A Owen BSc FRICS Owen & Owen 01646 621500 G RWall MRICS FAAV MIAgrM McCartneys 01544 230316 T I Parry FRICS Brightwells 01982 553614 Edward Perkins OBE FRICS FAAV ACIArb Edward H Perkins 01437 760730 Andrew J Morgan FRICS FSVA FAAV Morgan & Davies 01570 423623 G Lloyd FRICS Watts & Morgan 01446 774152 G Owens FSVA FAAV FRICS McCartneys 01547 528621 M R Peters FRICS FAAV BK 01452 880000 Simon Lloyd BSc (Hons) MRICS Cooke & Arkwright 01656 644644 J E Bibby MRICS Clough & Co 01745 812049 R GWilliams FRICS FAAV ACIArb Williams Parry Richards 01989 567233 James Andrews BSc FRICS Llywelyn Humphreys 01267 237812 Tim Barter MRICS Carter Jonas 01248 362536

H Mallaby/J Dennis Smiths Gore 01543 251221 M J Laws FRICS Carter Jonas 01939 210440 Ms Chri stine Baggott BSc MRICS Bagshaws 01889 562811 G RWall MRICS FAAV MIAgrM McCartneys 01544 230316 C E AHaselwood FRICS FAAV Clayson Haselwood, Fisher German 01295 271555 Nigel Morris FRICS NDA FAAV MRAC Morris Bricknell 01989 768320 R R Williams BSc FRICS McCartneys 01497 820778 P B Segrott FRICS MRAC Balfours 01588 673314 YORKSHIRE AND HUMBERSIDE A W Black MRICS FPD Sa vills 01904 617800 Ralph Ward FRICS FAAV Frank Hill & Son 01964 630531 K Pritchard MRICS FAAV Brown & Co 01652 654833 A J Fallows MRICS FAAV Carter Jonas 01904 558212 Giles Johnston MRICS FAAV DDM Agriculture 01652 653669

12

RICS farmland market survey Second quarter 2003

RICS contacts Rural land market information For general information about the rural land market, contact the RICS Library information service on FAX : 020 7334 3784, or the RICS Rural Faculty on 020 7334 3860. The rural market survey is available from the RICS web site - www.rics.org, along with other quarterly and monthly surveys covering residential sales & lettings, commercial property, and the construction market.

Survey subscription information and data enquiries To subscribe to hardcopies of the market surveys and to obtain data time series, please contact the RICS library on Fax: +44 (0)20 7334 3784 Subscription rates are: Housing market survey (12 issues per year) Non RICS members £170 per year RICS members £125 per year All other quarterly surveys (4 issues per year) Non RICS members £105 per year RICS members £65 per year For statistical information, please contact Ryan Emmett on +44 (0)20 7334 3777 For database enquiries, please contact Janet Guilfoyle on +44 (0)20 7334 3890 The statistics provided by RICS members in England, Wales and Scotland, are collated by the Royal Agricultural College, Cirencester.

The Royal Institution of Chartered Surveyors 12 Great George Street Parliament Square London SW1P 3AD T +44 (0)20 7222 7000 F +44 (0)20 7334 3795 [email protected] www.rics.org