UK Farmland Values Fall by 1% in Q3

UK estate agency registered a 1% fall in UK farmland values in Q3 2011, however, property experts believe this is only a temporary change.

The latest report by an estate agency suggests that farmland values in the UK fell in the third quarter of 2011. Even though the decline amounted to only 1%, it was the first decline registered since the first quarter of 2009.

In the opinion of Clive Hopkins, head of farm and estate team at the estate agency, prices might well further decline in the remaining 3 months of 2011 because many farmers and investors started to believe that UK farmland is overpriced. As such, he said that "a number of my clients looking to invest say they are waiting to see how the economic situation pans out over the next six months."

Property experts also suggested that the decrease might have been caused by the banks' attitude, many of which started to become more cautious.

Property experts, however, do not believe that the price falls in the last 2 quarters of 2011 will lead to a long-term trend. "The general direction of the land market is still upwards as investors look to tangible assets supported by strong fundamentals," said Clive Hopkins.