2024-05-14-莱坊-English_Farmland_Index_Q1_2024_2页_734kb

Knight Frank Farmland Index Summary

• Recent Prices: The Knight Frank Farmland Index tracks average prices of bare agricultural land in England and Wales. In Q1 2024, prices rose by 1% to a record high of £9,250 per acre, marking an annual increase of 6% compared to previous year. This outperformed assets like FTSE 100 (+4%), UK house prices (+1%), and luxury London residential (-2%), but gold (+11%) did slightly better.

• Key Drivers and Reassurances: Government action by HMRC provided reassurance that farmland allocated to environmental schemes still qualifies for Agricultural Property Relief (APR) on inheritance, potentially boosting green land purchases. This, combined with enhanced government environmental schemes, supports market activity, even as ongoing factors like declining EU Basic Payment Scheme subsidies, adverse weather, falling agricultural commodity prices, and a looming general election dampen enthusiasm.

• Market Outlook: Despite minor positive trends in land availability, prices are expected to remain relatively stable in 2024 with limited overall increases. The imbalance between supply and demand from previous years persists, keeping prices in a narrow range. Long-term data shows strong capital growth over the past decade, but short-term volatility is influenced by economic and weather-related factors.

• Agricultural Indicators: Key produce prices vary, with feed wheat declining and others showing modest increases, reflecting broader market dynamics.

Overall, the index highlights a resilient but cautious market, with government policies playing a key role in sustaining land values amid uncertainties.