While property prices in the UK and across the globe have dropped for much of 2008, agricultural land in the UK has been a good investment. According to research from Savills, agricultural land has increased in value for all of 2008 by 21.5 percent.
One of the main reasons for the increase in land prices is the price of wheat, which correlates well to the price of land. 2009 is expected to be a good year for wheat prices, which has helped to drive up land prices. Over the past five years, agricultural land has increased in value by 135 percent.
Ian Bailey, head of rural research at Savills, says “Our outlook for wheat, the main determinant in setting overall land values, is bullish for 2009. We therefore confidently expect that agricultural land will be well-placed to defy, in large part, the downward recessionary pressures.”
The company predicts that average land values will remain stable through 2009, perhaps softening a bit but with a positive outlook for the second half of the year.
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